Our listing clients often ask us which home improvements provide the most bang for the buck when it comes time to sell. We always remind them that the market value of a home – what it will sell for to a willing buyer – is in large part determined by the sales prices of similar homes in the neighborhood, and surrounding neighborhoods. Considerations include age of the home, condition, square footage, and, yes, improvements.
When considering improving a home to get it ready to sell, it’s important to make smart decisions to avoid over-improving the home for the neighborhood.
A good first step is to get clear on the home’s current market value and we’re happy to help you there, at no charge.
Now you know the starting value, before adding improvements. Plus, you’ll also receive the all-important sales prices of nearby homes. Remember, when determining which improvements to make, in the end, the home will only sell for the maximum sales price of similar area homes.
The next step is to figure out which improvement projects will realize the largest return on your investment. The addition of an attic bedroom, for instance, will net you a 72.5 percent return on investment (ROI), according to Remodeling Magazine’s annual Cost vs. Value Report. If that return is higher than the market will bear, it’s an improvement you don’t want to take on.
A minor kitchen remodel brings a 72.1 percent ROI, whereas that figure is 65.7 percent for a major kitchen remodel. Replacing the home’s siding will bring a 78 percent ROI. These are numbers that need to be weighed in light of current market values in the area.
Choose your improvement projects carefully, get several bids for the work, know the highest potential sales price you’ll realize and you’ll avoid the danger of over-improving the house.