That is always a question…
And like most questions, there are two polar opposite answers that leave little room for anything but personal interpretation.
Don’t Do It…
The White House renovation (Photo credit: Wikipedia)
It is a pretty easy case to make. The bottom line is that there are few, if any, renovations that you can do that will increase the value of your home. About the best you can do is get back around 75-80% of the money spent on the renovations. Of course, that is assuming that you are paying someone to do the job, not doing it yourself…
Looking at Remodeling Magazines annual statistics, there are a couple of standouts, but few things will get back that much of your money at sale time. Link
So, renovating prior to selling your home prior to sale is really only a way to burn cash that you could plow into a new home…
Not So Fast…
There IS one thing about renovating that does make sense. Competition. Aside from needing to compete for buyers with the house up the street, you need to compete with new construction… now more than at any time over the last few years. Here in the Atlanta suburbs, builders are going NUTS. They are barely able to keep up with the demand, and standing inventory is hard to find.
In order to effectively compete, YOUR house needs to look its best. Those renovation may just pay back in a quick sale. And that might be worth a little lost money…
My Opinion?
Coraopolis Railroad Station (Photo credit: Wikipedia)
Don’t go nuts… Price fixes everything, and you may not have to take the same kind of hit on price as the renovation might take. Doing a $100k major upscale kitchen remodel probably would be overkill. Putting up a fresh coat of paint, however, DOES make a lot of sense.
Do NOT forget that your time IS valuable. That is one issue that I often see. People remember that the paint will cost $200, but forget that they are going to be spending 20 hours applying it. If you are going to renovate, don’t discount the value of your time to $0. Sure, you might not need to value your weekend labor at $100/hr, which some contractors WILL charge, but give it some value. Weigh that into your decision.
Next week we’ll be looking at it from the buyer’s perspective…
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