How to increase the value of your home and avoid the common pitfalls that turn renovation investments into Sunk Costs:
Overbuilding for the Neighborhood
Homeowners may, in an attempt to increase the value of a home, make improvements to the property that unintentionally make the home fall outside of the norm for the neighbourhood.
In general, home buyers do not want to pay $550,000 for a house that sits in a neighbourhood with an average sales price of $450,000; the house will seem overpriced even if it is more desirable than the surrounding properties. The buyer will instead look to spend the $550,000 in a $550,000 neighbourhood. The house might be beautiful, but any money spent on overbuilding might be difficult to recover unless the other homes in the neighbourhood follow suit.
Fresh paint equals cleanliness in the eyes of buyers. Buyers don’t like going into a house with fingerprints and scratches. Use the universal colours instead of extreme colours that need rework by new buyer.
Door knobs, door bells, light switches, and electrical outlet covers. These touchpoints are where a potential buyer will get up close and personal with your home. Think about greeting someone with a weak handshake — that’s the impression your house will give if you neglect these simple upgrades.
“If you’ve got a buyer coming through, they’re going to grab the door handles and turn on the light switches. If the hardware is all old and busted, you immediately feel like this is a low-quality product that you are getting into.
Aprons and tea cozies help make the kitchen feel like the heart of any home, it’s the first place homeowners should look to do more serious upgrades.
Refurbishing cabinets and replacing faucets, sinks, and countertops makes a big difference on price since people tend to congregate in kitchens because of the high-traffic and functionality of the space.
Home buyers may appreciate well-maintained or mature landscaping, but don’t expect the home’s value to increase because of it. A beautiful yard may encourage potential buyers to take a closer look at the property, but will probably not add to the selling price. If a buyer is unable or unwilling to put in the effort to maintain a garden, it will quickly become an eyesore, or the new homeowner might need to pay a qualified gardener to take charge.
Gone are the days when the basement served as a catch-all for outdated furniture and home décor. Buyers are looking for a place to relax that exudes the same quality as the rest of the home.
The best layouts feature a large, open media-focused room at the foot of the staircase where guests can get comfortable and enjoy a movie.
While real estate listings may still boast “new carpeting throughout” as a selling point, potential home buyers today may cringe at the idea of having wall-to-wall carpeting. Carpeting is expensive to purchase and install. In addition, there is growing concern over the healthfulness of carpeting due to the amount of chemicals used in its processing and the potential for allergens (a serious concern for families with children). Add to that the probability that the carpet style and colour that you thought was absolutely perfect might not be what someone else had in mind. Because of these hurdles, wall-to-wall carpet is something on which it’s difficult to recoup the costs. Removing carpeting and restoring wood floors is usually a more profitable investment.
Keep Custom Builds in Check
The experts agree that the worst thing a homeowner can do is build a highly personal project and expect to recover the cost when they sell. Renovating to boost the value of your home means adding features most potential buyers will appreciate.
A bit of research, or the advice of a qualified real estate professional, can help homeowners avoid costly projects that don’t really add value to a home but rather a sunk cost.
All said and done, “You can’t make an omelet without breaking a few eggs” Let an expert handle it!