Before you make a delve into a new renovation idea and make it a reality, consider whether the project will pay off when you are ready to sell. Plenty of home improvements add value, but others -- like these five -- can hurt it.
1. A chef-quality kitchen
If you love to cook, a high-end kitchen could be the ultimate gift -- for you. But if you think a massive overhaul will majorly impact resale value, you might be in for a surprise. An upscale kitchen renovation tends to recoup approximately only 54% of its cost in added value, according to an article I found in a Remodelling magazine which had an article about Cost vs. Value report.
If you do marble countertops and high-end appliances, you could spend 100,000, and it doesn't necessarily mean your house is worth an extra 100,000. Smaller kitchen upgrades could yield a bigger payoff.
However, if you are remodelling to suit your new dream kitchen ideas without the intention to sell, have fun within your budget. No budget? Even better!
2. DIY painting
A bold statement wall can say the wrong thing to potential buyers if the workmanship is questionable. Streaky, chipped or low-quality paint can deter buyers and question the quality of the home in other areas. It also prompts a heavier negotiation reason from the buyer.
A good paint job is not easy, it is all in the prep work, and most people don't want to do the prep work. Hiring a professional to paint can help ensure a more attractive result.
3. An expanded master suite
Knocking down a wall to create an oversize master bedroom or stealing closet space to build out a spa-style bathroom may sound dreamy. But how about as a selling point? If you go from five bedrooms to four, and you can make it work, no big deal, but it is cautioned that losing a bedroom in a smaller house could mean a lower selling price.
As for cutting into closet space, residential building codes don't mandate that bedrooms have closets. But, once you take the closet out of a bedroom, to a buyer possibly, that no longer looks like a bedroom.
4. Plush wall-to-wall carpeting
Carpet can be especially unattractive to first-time home buyers, who may be used to landlords updating carpet between renters.
In general, people are grossed out by [carpeting]. It can make a room look a little bit dated.
It can also dent your sale price. Carpet as the primary flooring in a house has been seen to drop the value, particularly carpeting in the master bedroom. Conversely, a report that I came across from the National Association of Realtors estimated that sellers could quite possibly recoup the entire cost of refinishing hardwood floors. New wood flooring could actually add value.
How to decide if a renovation is worth the cost
To ensure you are making an informed decision:
- Consider your timeline. If you are going to be in the home for 30 years, you can do anything, because at that point, your mortgage is paid off.. Looking to sell in the near future? Pay closer attention to whether your choices will appeal to a potential buyer.
- Consult an expert. Talk to a professional so you aren't making misinformed choices that are going to work against you in five to 10 years. A designer can help you tell fleeting trends from future classics; a contractor can explain what kind of work a proposed renovation would entail.
- Compare home features in your area. We suggest looking at comparable homes for sale near you and going to open houses to make sure your improvements align with the norms for your neighbourhood.
- Get an appraisal. A local real estate agent in to have a walk through and do a feasibility appraisal to estimate your homes current value and its likely value after the improvements.