Monday, September 21, 2009

Top 10 Home Improvements and their Return on your Investment

A few blogs back I wrote about simple low cost or no cost things you could do to make your home infinitely more saleable:
http://nationalbuildersupply.blogspot.com/2009/08/how-do-i-sell-my-home.html
My feelings are that with the economy in its current state and the fact that many folks are buried in their homes and can’t afford either on a cash basis or credit wise that to put more money into their house is just not feasible. I am still of that opinion but over the weekend AOL published an interesting article listing top ten things that you might spend money on and the return that you could expect to get when you sell. I am of the opinion that these are things to consider only if you are planning on renovating you home to stay in it for the time being not if you are looking to eminently sell. The following are excerpts from that AOL article as well as a link to the original source from “Remodeling Magazine” both to whom I extend credit and thanks for the use of the material.
“If your house has been sitting on the market since spring, you may be asking yourself what you can do to 'get it sold.' As any fan of HGTV will tell you, you can do one of two things or some combination of the two.
1) See what other homes in your area are selling for, then cut your price to make it competitive.
2) Make reasonably priced improvements to help your home look it's best.
There are plenty of home improvement projects that you could spend $10,0000 or $20,000 on, but it's unlikely you'll get more than 50 percent of that back on your resale price in this market. It may be better to offer a credit to the buyer for that amount, rather than trying to do the work yourself.
The top ten high return on investment Projects For Under $30K were listed as follows:
Project | Return on Investment
1. Deck Addition (wood), 81.8%
2. Siding Replacement (vinyl), 80.7%
3. Minor Kitchen Remodel, 79.5%
4. Window Replacement (wood), 77.7%
5. Window Replacement (vinyl), 77.2%
6. Bathroom Remodel, 74.6%
7. Deck Addition (composite), 73.7%
8. Roofing Replacement, 65.5%
9. Backup Power Generator, 57.2%
10. Home Office Remodel, 54.6%
Source: Remodeling Magazine's Cost vs Value Report
As I detailed in my previous blog imagine want a potential buyer sees as they walk up to your home for the first time. Are the bushes covering half the house? Is the yard full of weeds? When the buyer first enters the house, does the paint and carpets look fresh and clean? You should try to try to create an experience for the buyer that they feel as if they don't have to do anything with the house, except maybe change the wall colors or that they can easily see themselves and their furnishings fitting. It is very important to be well versed in the “comps”(comparables) in your neighborhood. Consider them to be your competition. You have to compete on more than just price but also in features, condition, floor plan and content.
Deck additions ranked highly in the report cited above, outdoor space is desirable for buyers but rather than build a 30 by 20 deck on the back of you house just to sell it? Consider screening in an existing deck or put a roof over it? Then it becomes a three-season space. Sellers may want to address at eyesores before they consider any grandiose additions so take care of the problems as opposed to trying to hide things with expensive renovations. As an example make a good first impression consider a new front door with leaded glass or "sidelights," pressure washing your deck or repairing any peeling paint or damaged siding before you start looking at anything else. As I recommended in blogs before, instead of tearing out your bathroom or kitchen look at replacing the countertops, plumbing fixtures, light fixtures and even some appliances.
In the end, in today’s market, your house has a better chance selling if you follow the simple rules that I laid out in my previous blog and know your competition and price it according.
As a passing note be aware that the Government’s $8000 cash purchasing incentive you only have until November 1st.

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