Home Improvement Tips: What You Should (and Shouldn’t!) Do to Increase Your Home Value
Posted by: CENTURY 21 Northwest
Date: June 10, 2019
Posted by: CENTURY 21 Northwest
Date: June 10, 2019
Most people think that home improvements automatically improve the value of their homes. They are, after all, improvements. In reality, though, not every improvement will actually be worth the investment. One of the most important home improvement tips to follow is to learn how to calculate your project’s return on investment.
If you’re looking at home improvement tips, you need to stop and consider whether or not your project’s actually going to do anything positive for your home’s value. While you might enjoy the change to your home, that doesn’t mean that others will want to pay extra for what you’ve added. Below are some of the most common projects, along with their real impact on your home’s sale price.
Going green is incredibly attractive to many prospective home buyers. So is having reduced energy bills. Adding solar panels to your home seems like it should be a no-brainer, especially since there are so many tax credits and rebates available to those who go solar. Whether or not this will bring a good return on investment, though, is something that you’ll want to look at carefully.
Do solar panels increase home value? It’s helpful to look at the math. The average cost of a solar installation is about twenty-one thousand dollars after you factor in rebates and tax credits. On average, buyers are willing to pay about twenty thousand dollars more per year for a home that has an installed solar system. As such, you probably shouldn’t install a solar system right before moving.
With that said, a solar panel system will save you about $850 per year on average, which evens out the two sums after a single year. The longer you have the system, the more money you will save.
Home improvement tip #1: If you install today and don’t put your home on the market for at least a year, you’ll wind up with a positive return on your investment.
Pools occupy a funny space in the home improvement game. Does a pool add value to a home? In terms of enjoyment, almost certainly. Does it actually add monetary value? That, unfortunately, depends on a number of factors. What you’re largely looking at isn’t necessarily something that will help your house price monetarily, but not having the pool might hurt your asking price depending on your situation.
Looking at raw numbers, the cost of installing an in-ground pool is conservatively estimated at around thirty thousand dollars. On average, a pool is understood to no more than a total of seven percent of the value to your home. Simple math will tell you that you won’t break even on the investment unless your home’s base price was already in the four-hundred-thousand dollar range.
Once you start getting in the half-million range, the pool’s still not going to give you much of an ROI but it might be hard to compete against other homes that do have pools.
Home improvement tip #2: As a rule, it’s usually a better idea to build a pool because you enjoy having access than to get your money back.
There are plenty of people who will tell you that replacement windows essentially pay for themselves. If you’re looking at factors like lowered energy bills or repair costs, you might be onto something. If you’re looking at a simple ROI, though, the question has a very different answer. Unless you’re living in an area that makes utility pricing the primary concern for homebuyers, you might not be getting quite the return on your investment that you have been led to believe. Fortunately, Arizonans can definitely find the value in a home that can help them save on energy bills in the long run.
Does replacing windows increase home value? Sure, at least a bit. On average, you’re looking at an increase of about eleven thousand dollars on your asking price if you replace your windows with modern-high end windows that not only help reduce utility bills but also fit in with a pleasing design scheme. Your cost, though, is going to be closer to fifteen thousand dollars. This gives you a return on investment of about seventy percent, or the ability to recoup about seventy cents for every dollar that you spend.
Home improvement tip #3: This is a nice ROI if you’re doing the project out of need, but not one that you’re going to do in order to raise the price of your home.
If you’ve ever watched a home improvement show, you will probably notice that the kitchen is one of the first areas to get tackled. It’s the centerpiece of many homes and one area that people always want to be updated, so it’s important to have a good kitchen when you’re selling a house. It is not, however, always an area of the home that’s going to bring you as much money as you might like. In fact, those looking for a quick turnaround might want to think long and hard about remodeling once they look at the numbers.
A full kitchen remodel brings on average a fifty-three percent return on investment. If you go for high-end changes and manage to be located in the right market, that can go as high as eight-three percent. That means that no matter what you spend, you’re going to take a loss in the short-term.
Home improvement tip #4: It’s absolutely worth making the upgrades if you aren’t planning to sell for some time, but it’s not something that you’ll want to do if you are planning to put your house on the market tomorrow.
Hardwood floors are one of the trickiest propositions when it comes to home improvement tips. The cost is fairly high, but most buyers state that they prefer hardwood floors to carpet. As such, this is one of the most recommended improvements even though it won’t necessarily bring the kind of ROI that you’d expect. In fact, traditional hardwood floors are going to boost your home’s value by less than three percent, meaning that the project may not be ideal.
While hardwood itself may not give you a great ROI, the look of hardwood may help you a little more. As such, you’re going to be better off finding a cheaper solution that won’t end up breaking the bank.
Home improvement tip #5: Switching over to a good laminate or vinyl will actually give you a better return on your investment while still attracting the vast majority of buyers.
While home improvement tips are nice, the most important tip is that you need to get a great agent when you’re selling your home. Doing so will not only help you to price your home competitively, but also to ensure that you get access to buyers who are actually interested in a home like your own. When you’re ready to get serious about getting the most for your home, make sure to contact Century21 Northwest and check out our New Home Affordability Calculator to figure out what your home is really worth.
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