There is really only one reason to try to increase the value of your home: if you’re trying to sell it. If you’re not, deliberately increasing your home’s value most likely will increase your tax bill as well. There are ways to increase your home’s value for resale that range from the very expensive (major remodels and additions) to free (tidying up the front yard). We’ll look at the whole range, noting how much value is added when possible.
Before you begin any of these projects, it is important that you do them with the following in mind: you do not want to raise the value of your property too far above others in the neighborhood. Why? Because people who want expensive homes will shop exclusively in higher-value neighborhoods. If you own the “best house” in the neighborhood, it is unlikely you will recoup whatever investment you’ve made. A good rule of thumb: keep the value of your property within 15 to 20 percent of your neighbors’.
The following figures appeared in the November, 2001 issue of Realtor Magazine. They list the top ten remodeling projects undertaken to increase a home’s value in the United States and what percentage of your remodeling investment might be recouped at resale.
Project (average cost recouped, national):
Minor kitchen remodel (88%)
Bathroom remodel (85%)
Major kitchen remodel (81%)
Family room addition (80%)
Deck addition (77%)
Master suite (75%)
Siding replacement (73%)
Window replacement (69%)
Home office (55%)
These are national averages, so in your area, the figures may be lower or higher. To explain, if you spend $10,000 on a minor kitchen remodel, you will be adding $8,800 to the value of your house. Remember that it’s a tricky business, trying to add value to your home. What seems to be value to you may not appear that way to any given prospective buyer.
Some tips when attempting value-increasing remodeling:
* Remodel with mass appeal in mind. Potential buyers are usually attracted more to neutral, mainstream design.
* Don’t go cheap when it comes to construction. Use durable, quality materials. If you’re a do-it-yourselfer, honestly evaluate your ability to do it right.
* Don’t remodel in a different style from the rest of the house. Additions and improvements that look “tacked on” may detract from a home’s appeal.
* Don’t do a $30,000 kitchen remodel in a $100,000 house – unless you plan to continue living there. It is a waste of money.
There are also low-cost ways to increase your home’s value. At the very least, the following things will make your home more attractive and inviting to prospective buyers.
* Make sure the outside of your home is spic-and-span. Clean the front door. Change the HVAC filters, Wash the windows and remove cobwebs and bugs. Sweep the sidewalks and driveway. Plant some colorful flowers out front. The reason for these small things is simple: If two similar homes in the same are area are both for sale, the one with the cleanest and most appealing front yard will sell first. Paint all exterior trim, fix/patch stucco and paint exterior as needed. Fix missing roof tiles.
* Do a full deep clean. This may seem like the most simple step, but doing a thorough clean of your entire home can do wonders for its value. As an added bonus of investing your time to perform the clean yourself is that as you go through the house you can declutter, take down personal pictures and put away personal items. Declutter closets, countertops, put away furniture that makes the room feel small or cramped. Using mirrors in a small space is a good way to increase light and create the illusion of more space. Velcro and small hooks underside of tables and desks is a good way to organize cables and cords that are difficult to hide. Eliminate odors... don't underestimate the power of clean when getting your home ready. Patch the walls and make sure the interior paint is fresh and neutral in color. Fix leaky faucets, or replace dirty outdated faucets. Make sure all lighting has working bulbs.
* One thing you can do inside to increase value is to make your home more attractive. We are talking about home staging! Making your home more beautiful is another great selling point. Buyers love homes that look pretty and they can envision their family living there. You can do this by adding colorful pillows, a nice throw blanket on the end of a bed or sofa and decorative colorful towels.
Contact me for more tips on how to quickly and easily increase the value of your home. I am always here to help you get the BIGGEST return on the sale of your home.