Most buyers want an updated, move-in-ready home and will pay top dollar for it. In return, they will often pass over one that’s dated or poorly maintained – or want a deep discount. I’ve seen it happen in my own neighborhood. Homes in poor condition or with less market appeal take longer to sell, have multiple price reductions, and often sell for less than anticipated by their owner – if they sell at all. But those in good condition have sold in days and close to list price. Unless you are ok with dropping your price until you find a buyer, it’s almost always better to be in good condition when you are ready to sell.
Getting your home into showing condition doesn’t have to be expensive. Amazing results can often be obtained from a deep cleaning, new fixtures, fresh paint, and proper staging. See for yourself in these before and after photos where I helped my seller with a neutral paint selection and brought in a few of my staging pieces. This home sold in 3 days for 97.6% of list price.
But before you update, it’s good to know both market expectations and property values in your neighborhood so you choose improvements that bring the best bang for your updating buck. Don’t do your research or don’t choose a Realtor who can effectively guide you, and you risk losing money by over improving or picking updates that don’t appeal to the average buyer. You can bet most buyers will love your major bathroom overhaul with free-standing tub, heated floors, walk-in shower, stone counter tops, custom vanity, and imported tile, but depending on the price range of your home and your market area, you probably won’t be able to add the full cost of your remodel to the price of your home. You very rarely get a dollar for dollar return, and typically the higher the cost the lower the return. If you plan to live in your house for a long time, go ahead and splurge. There is value in enjoying something every day. But, if you are looking to sell soon, keep your investment on the lower side.
You can save money with sweat equity which works great for things like painting, or swapping fixtures, but unless you have the skills to do good work, hire a professional for your projects. When buyers see work that looks DIY, they start tallying the expense to fix what you’ve done and will often walk away or bring you a low offer. Either way, bad craftsmanship wastes your time and money.
So what does the typical buyer like in a home today? It depends on who the typical buyer is for your area, but kitchens and bathrooms are always a good place to put your money. There are many resources on the internet that will give you advice, but beware of those that state a certain return for certain updates. A $20,000 bathroom remodel might bring you a 75% return on investment in a higher priced home, but only a 20% return in a lower priced home. There is never a standard return across the board for all houses.
So what’s the bottom line? If you want maximum value from your home, it’s important to make the right updates, so talk to a real estate professional that knows your market area before you start.
Jacque Veney, Broker