This time of year in particular, one of the most common questions we hear from our listing clients is whether or not they should renovate their homes prior to putting them on the market.
Whether your goal is to make more money off the sale of your home or to help it to sell faster in a competitive market, part of our services to our clients is to help you figure out where to focus your time, energy, and money.
Make repairs first
Deferred maintenance is a phrase that keeps your Realtor up at night! Let me therefore encourage you to concentrate first on making needed repairs. Once you find a buyer and go under contract on your home, during their due diligence, they will most likely find many of the same issues that you know about and ask for these repairs, so let me encourage you to be proactive and make them before listing the home for sale! This helps avoid delays during the transaction. Beyond that it shows you care for your home, and buyers like to see that in a seller!
Being proactive is always a smart move in real estate
Some of these tasks include scraping off peeling paint, replacing broken windows, torn screens, dripping faucets, and loose or missing handrails.
Where to start? Any problems that affect health and safety should be addressed first. Then, use what’s left of your budget to make the cosmetic fixes that are attractive to homebuyers in your home’s price range.
Consider minor upgrades
“Don’t spend money that won’t yield a return on the investment. The best expenditures for most markets are paint, carpet, light and plumbing fixtures,” Matthew George, the chief appraiser of Eagle Appraisals Inc. in Denver, Colo. tells The Wall Street Journal.
Decide which room or rooms require the most updating and start with those. For example, replace the appliances along with kitchen and bathroom countertops, but don’t replace the cabinetry. More minor updates will do more to change your sales price compared to redoing the kitchen or bathroom entirely.
According to Remodeling Magazine, a major kitchen or bath remodel is a money pit. The magazine’s 2019 Cost vs. Value Report warns that you’ll spend more than $65,000 on a major kitchen remodel, on average, yet you’ll only recoup roughly 62% of that when you sell your home!
You’d do far better to focus on a minor kitchen remodel, spending on the average about $22,500 and realize an 80% return on money invested.
Early this year, a couple that I’d sold a house to about 3-4 years ago contacted me about reselling their home this spring. They had renovated every room in the house except the kitchen. That kitchen was the one room that they hated most when they bought it, but just never got around to doing anything to it!
They ended up doing the work to renovate the kitchen by putting in granite countertops, white subway tile backsplash, kitchen sink, and new stainless appliances. The result was we had a home that many felt previously would sell in the mid-to-high $250k’s ended up closing for $278k! The work involved didn’t cost them anywhere near the value in that buyer’s eyes for having a move in ready home with an updated “farmhouse inspired” kitchen!
“How do I do it though Hank? I don’t know any contractors.” If your agent has been around awhile, likely they know contractors they trust who can do from the most basic cosmetic changes to full scale renovations to update the house for you prior to listing. Contractors who will be fair with you. For example, I have a general contractor who can literally subcontract out any aspect of getting a home ready to list. This includes making any repairs the home might need. From that standpoint we can provide a turn key approach that makes the home owner’s life easy!
Save money or time?
In a real estate transaction, time is most definitely money. For example, the longer a home sits on the market, the better the chances that the homeowner will end up taking less than planned to get it sold.
The most common reason a home doesn’t sell is that it’s overpriced. Second to that, however, are homes that aren’t in decent condition. They aren’t ‘move in’ ready.
The first week that the house is on the market is known as “the honeymoon period.” This is when new listings receive the most attention and the more people that view the home, odds are the quicker it will sell.
Recent studies have shown that homes get four times as many visitors in the first week they’re on the market than they do one month after listing.
With repairs and cosmetic fixes out of the way, your home will be the focus of the local real estate market during that first week!
We’re happy to meet with you and offer suggestions on which repairs to make first and on which tasks to focus on after that.