If you are considering selling your home, you are likely interested in how to maximize your sales price. There are several ways to increase your home’s value, but there are many ways to throw money at your house and not recoup a cent. For potential sellers, the situation presents a dilemma: How can you make your home attractive to buyers while also earning a return on your investment?
What’s your home’s value?
Before diving into any home renovation project, you need to firmly understand your house’s value and the trends in your market. Some blindly assume that they need to revamp their kitchens or bathrooms in order to have any shot of getting buyers. While these generally are renovations that pay off, that is not the case for every home, and certain markets may call for more or less upscale upgrades.
Also, knowing your home’s value also can arm you with realistic expectations about potential future appreciation. Here is how to get a firm grasp on its value:
- Speak to an expert. You can obtain a professional opinion on your home’s value from a few sources. You can contact an appraiser for an appraisal or ask for a broker’s price opinion (BPO), which is a less formal appraisal that can be provided by a real estate broker. If ordering an appraisal, make sure that the appraiser understands the purpose of the value opinion.
- Search completed sales. Appraisers and real estate brokers base value opinions on several factors, the strongest of which are recent sales or “comps.”
- Remove emotion. Sentiments cloud value opinions. We tend to think our home is worth more than others for no reason other than the fact that the home is ours.
- Know what improvements add value. This requires not only knowing buyer wishes in general, but specific wants and needs in your area and neighborhood. A gourmet kitchen may be expected in some markets but overkill in others. Some improvements, such as a pool in the Northeast, may actually reduce your home’s value.
Modifications that are always winners
Simple renovations that improve your home’s functionality often provide a return on your investment. Updating old appliances adds value not solely because of appearances, but also because the new, modern styles work better and meet modern needs.
Painting is an effective and inexpensive way to add value. Keep in mind that most buyers want a blank slate, which makes your home a space they can envision themselves living in, so keep the color palette simple and neutral.
Another winner is any work that creates outdoor spaces. If your home has an outdoor deck, stage it with comfortable new outdoor furniture and add lighting and outdoor speakers. Buyers adore the extra outdoor space that a patio provides. While adding a patio is a moderately difficult job, the availability of specialized tools at home centers makes the job DIY friendly. In order to create a firm base, a large vibration damping tool is often required. But the rest of the job can be accomplished with simple hand tools such as a laser level.
When working outside, take the opportunity to shore up landscaping. A new coat of mulch and some tree and hedge trimming each provide phenomenal return on investment and attract buyers to take a closer look.
Maximizing your home’s value requires thoughtful renovations and an unbiased understanding of what it’s worth. Armed with information, sellers can present their home in a light that is most attractive to today’s buyers.
Thanks to Danny Knight for contributing to our blog! We are looking forward to hearing more kitchen inspiration from you!
Photo Credit: Pixabay
