HOME UPDATES THAT PAY OFF (AND INCREASE YOUR PROPERTY VALUE)Written by Charlie Parker on Wednesday, 22 July 2015 1:22 pm
Save up to $400 on Smart Online Marketing Solutions for Agents & Brokers In today’s competitive real estate market, homeowners are often overwhelmed with the countless projects needed to make their properties stand out from the competition and appeal to buyers. Whether you’re putting work into minor projects or extensive renovations, how can you know if your improvements are truly worth the money and effort? For starters, stick with the areas that are guaranteed to see an increase in property value and return on investment (ROI). These major areas include: exterior updates and decor, kitchen renovations, and window replacement.
UPDATING THE HOME’S EXTERIOR
The first thing that potential buyers see is the home’s exterior. If the roof, siding, front door, and garage are all in shambles, there’s a very likely chance that there won’t be much interest about the inside.
A 2014 'Cost vs. Value' study conducted by Remodeling magazine concluded that updating the home’s exterior siding with a fiber-cement material can recoup 88% of the homeowners initial investment. Be sure to choose the best siding material to best suit your needs and that of your property. If your home is in an area with inclement weather, vinyl siding faces the possibilities of cracking or warping, whereas fiber-cement is created through a mixture of sand, clay, cement, and wood pulp to be highly durable and long-lasting. Keeping up with the movement for sustainable, eco-friendly construction materials, there are many options for long-lasting siding that will bring a sizable return.
Updating the front door is a major improvement for the value of your home since it is the first thing the buyers see. Both the front door and garage door reflect at least 83% ROI when swapped out for current models. Replacing the front door with a steel door with a half-glass panel and new lockset is widely recommended since it requires significantly less maintenance than wooden doors. If roughly $2,000 is spent on replacing both the entryway and garage doors, there is a great chance of seeing your money returned when closing the sale.
The matter of new roofing is somewhat tricky when considering updates and renovations to your home. A new roof may not necessarily add any value to your property depending on the rest of the conditions, but an old roof in need of extensive repair may cost you more. Buyers can use a damaged roof to negotiate a lower selling price in order to make their own changes once the sale has been finalized. If a roof repair is on your list, you may be lucky enough to see about 67% return on your investment during resale.
COOKIN’ UP REPAIRS IN THE KITCHEN
The kitchen sells a home. No matter the rest of the conditions, the simple truth is that buyers are going to consider the kitchen as a priority when making their decision and putting in offers. Even if the other rooms in the home need fixing up, most buyers are going to want move-in-ready kitchens. The good news is that kitchen renovations have a wide range of options to help with upfront costs that can be anywhere between a few thousand or upwards of tens of thousands of dollars. A minor kitchen remodel under $25,000 may see up to 87% ROI and a major project can see a return of about 74% for the home’s property value.
Updating your kitchen can be as easy as putting in some elbow grease during a few weekday nights or a long DIY weekend. Consider the following minimal cosmetic treatments:
replacing out-dated cabinetry, hardware, and lighting
updating existing flooring and molding
installing new appliances or countertops
a fresh coat of neutral paint on the walls and ceiling
If it works within your budget and selling timeframe, you can gut the existing kitchen down to the studs and rebuild with modern functionality in mind. You will likely have to enlist the help of a professional kitchen and bath interior designer, but the guidance will be well worth the reduced stress compared to planning a major remodel on your own.
REPLACING WINDOWS FOR MAXIMUM EFFICIENCY
It may not seem like an obvious repair, but updating the home’s existing windows can bring about a return of nearly 79% when you sell. If your home is particularly old, the single-pane, wooden windows can harm the property value and increase your energy costs while you’re still living there. New windows improve the curb appeal of the home, as well as, provide a source of natural light and noise reduction for the interior. With the potential for your energy bills to be reduced by 25% while you’re in the home and an average of 87% ROI for new windows, there is no sense in putting off the window replacement any longer.
Homeowners are especially likely to see a result when replacing windows in the following locations:
Unfortunately, living in the desert or more arid climates doesn’t see the ROI that bigger cities do -- you’re lucky to get a 62% return in the southwest.
THE BOTTOM LINE
Instead of tackling projects willy-nilly, put your focus and efforts in areas that are guaranteed to improve the property value and your chances of a speedy resale. Take into consideration your property among the home values in the rest of the neighborhood and determine the best course of action for your own needs. An ultra modern exterior would stick out sorely in an area of classic ranch-style homes or a brightly-painted door on a Tudor-style home would raise some confusion and could be off-putting for potential buyers. Be sure to consult your local real estate agency and peruse the Cost vs Value study for more direction during the selling process.