Whether you’re putting your home on the market this year or in the next five years, it is a smart decision to start building your home’s resale value now. Here are some ways to create a comfortable home while making it easier to put more money into your bank account on closing day.
Small Maintenance and Repairs
If you think that home maintenance on the weekends is a waste of your time and energy, think again. The small chores you do around your home can prevent it from losing value. Neglecting small maintenance and repairs can cause 10% of your home’s value to walk out your door and slip through your windows. Many appraisers claim that homes showing little to no preventative maintenance can depreciate a home’s value from $15,000 to $20,000.
A study conducted by researchers at the University of Connecticut and Syracuse University shows that regular maintenance boosts your home value by about 1% per year. However, ongoing maintenance costs offset that value, which means that regular maintenance actually slows down your rate of depreciation. Furthermore, because homebuyers tend to notice needed repairs upon buying a new home, proactive maintenance lets the potential home buyer know that he or she will not have to spend extra money to maintain the basics. This makes your home more attractive, and thus more likely to get higher priced offers.
Maintaining the basics can cost you little money and certainly some effort, but there’s a way to accomplish this very important activity. This article by HouseLogic, for example, shows you how to keep home maintenance below $300 a year. Planning ahead will also help make maintaining your home easier. Most professional appraisers and real estate agents can recommend a proactive maintenance schedule that includes:
- Keeping enough cash on hand to replace systems and materials
- Creating and following a maintenance schedule
- Planning a room redo every year
- Keeping a notebook of all your maintenance and repairs
- Purchasing a home warranty to help cover big-ticket items
The Virginia Cooperative Extension at Virginia Tech published a study that shows landscaping can increase a home’s value up to 12%. The study claims that a home valued at $150,000 could increase its value between $8,250 and $19,050 with the addition of landscaping. Particular landscape elements add different value. For instance, landscape design can increase your home’s value by 42%, plant size can increase your home’s value by 32%, and diversity in plants can increase your home’s value by 22%.
COST VERSUS VALUE 2019
The Cost Versus Value report from Remodeling.HW.net is a great annual resource for homeowners to see where their dollars will go the furthest when making updates and upgrades around their homes. I have linked to the 2019 Phoenix metro Cost Vs. Value report, but you can download the same report for your neck of the woods via their website. The average costs and values used below are from this report.
Garage Door Replacement
At first, you might not think that your garage door increases the value of your home. However, your garage door distinguishes your home from the other homes on your block. As the largest entryway of a house, garage doors get noticed first because they’re the focal point of your home. If you want to quickly increase the resale value of your home, you need to make the most of this space. (Note: Many HOA’s have specific design guidelines about garage doors. Please make sure to investigate this before embarking on your project!)
Some interesting things being done with garage doors include:
- Increased Size: Bigger garage doors help homes stand out more, and homeowners can do more creatively with them.
- Bold Colors: Bright and bold colors now can complement the color of your home, or you can build a concept around the color of your home.
- Faux Wood: You can install fiberglass or steel garage doors that look like wood garage doors. This gives your home a new level of sophistication.
- Windows: Large windows on your garage door improve the aesthetic of your home, and provide light into your garage so that it’s no longer a dark space.
More importantly, a garage door replacement will cost you around $3,562 and add $3,661 to the value of your home; that’s a return on your investment of 102.8%.
Replacing your windows is another way to save energy and increase your home’s resale value. Replacing your old windows with energy-saving models will beautify your home, keep it comfortable, and ease the workload of your HVAC system. According to HGTV, you’ll see a reduction in your utility bill by 7% to 15%.
If you’re selling your home, you could expect about a 72% recoup of your investment. The two types of replacement windows that fetch the best return are vinyl and wood.
Remodeling Your Kitchen
Kitchen remodeling can get expensive, but small renovations can make your home more buyer friendly. Changing your kitchen’s texture and color using a matte finish and neutral colors such as putty or grey enhances your home’s resale value. Because matte finishes have transitional qualities, your potential home buyer can easily match his or her stainless steel or black and white appliances. Also, refinishing cabinetry, or switching to Energy Star™ appliances can provide a look you like and as well as some pizzazz.
Flow is important to any interior design of a home. If you feel that your kitchen hinders a good flow, change it. A small investment to knock out a non-structural wall or remove a kitchen island creates space and provides a flow that buyers love.
A minor kitchen remodel can cost you $21,818 while putting $16,038 of resale value into your home; that’s a 73.5% payback on the project. If you want to do a major kitchen model, this can cost you about $64,000 and put about $40,500 of resale value into your home, which is only about a 63% payback on the project. Therefore, consider a minor kitchen remodel first.
Adding Stone Veneer
Many Phoenix and Scottsdale homes have lovely stonework on their exteriors. In terms of cost versus value, this is a good one. Adding manufactured stone veneer to your home will cost about $8,800 and will add about $7,400 in value. This is an 84% return on your investment.
Bathroom Addition or Remodel
Likewise, carefully consider adding a bathroom or remodeling your bathroom.
Doing smaller projects like switching out your frosted glass shower doors for clear glass doors, cleaning the grout, replacing the shower and floor tiles, switching out your sink or toilet, or replacing your sink and shower fixtures can cost you little money and make an impact.
Adding a bathroom can get expensive, but it can reduce congestion during hectic times and provide your guests with a bathroom. Consult with your real estate agent or a local appraiser before deciding whether a full remodel or addition is right for your situation.
While a bathroom remodel will cost you about $19,665 with a return on investment of about 66%, a bathroom addition will cost you about $45,000 with a return on investment of about 61%. Therefore, it’s best to do your due diligence before committing to a large bathroom project or addition.
Your Needs and Buyers’ Wants
If you need or want to renovate your home, be sure to consider how those changes will affect its appeal to future buyers. Knowing design trends will give you the opportunity to make changes to your home based on where your needs and your potential buyer’s desires intersect, thus increasing your property’s resale value drastically.
Designers and design websites provide great ideas when you’re brainstorming home renovations. Keep in mind as you research, however, that you don’t want to sacrifice your needs for a comfortable home just for the sake of what you think a future buyer will want!
Before you begin making any changes to your home, consult your real estate agent. Real estate agents, because we are constantly working with new buyer clients, have insider insight into what home buyers are looking for now and in the foreseeable future. We’ll be able to help you make smart choices when remodeling or renovating your home and can recommend professionals to help you get the job done.
If you think you might want to remodel or renovate your home in the near future, or if you are just curious about other ways you can increase its resale value, please reach out to us!