Home renovations can be seen as a fun project or an improvement. Others who are looking to refinance or to sell will look at home renovations differently. Little improvements around the space can greatly increase the value of a property. If you are planning on selling some time soon or want to refinance, you might be wondering which renovations will balance budget with benefits.
Turns out, you have plenty of options for home renovations that add a lot of value.
Are Home Renovations Worth It?
A lot of people think of making home renovations but never get around to it. Or, they decide that the cost is just not worth it and sell their home off at a lower value. They deduct $20,000 from the asking price, for example. Yet, in reality, it doesn’t work this way. Homes that need repairs will have a much lower price on the market than what the repairs are valued at. In other words, if your repairs are an estimated $20,000, you lose $40,000 on the asking price.
So, is it worth skipping out on home renovations? No. Spending a little money on improvements around the house will increase the price. However, you need to be smart. Some home renovations will be costly but do little for the value of your home on the market.
How to Choose The Things You Should Fix
Choosing what to fix prior to selling comes down to a few factors, such as the neighborhood in which you live, the area, and also the condition of the property itself. It might seem like a great idea to put a $50,000 kitchen into a mobile home, but it won’t add much value to the manufactured home because of the other houses surrounding it.
Furthermore, if there are things wrong with your house, such as a bad roof, cracks in the foundation, and a faulty HVAC unit, it automatically deters most of the prospects.
But how do you know what makes for the best renovations? You can consider the 70% rule. The rules says that an investor in a home will pay 70% of the value of that property minus the repairs it needs. For instance, a home that is valued at $250,000 but needs around $30,000 of repairs means that the buyer will only want to pay around $145,000.
The equation looks like this: $250,000×0.7 = $175,000 – $30,000 = $145,000
That is a lot of money for you to lose. And while it might seem like a money-grabbing move from the buyer or investor, look at it from their perspective. They must purchase everything needed for the repairs, handle the financing, and then, if they decided to sell the property again, they need to deal with that too.
So, if you are struggling with choosing home renovations that add the most value, remember: Fixing the problems that would cost the most or require financing are your best bet.
The Home Renovations That Add The Most Value
Here are the most significant home improvements you can do to boost your home’s value:
Minor Kitchen Remodel
You may have heard the saying that the kitchen is what sells the house. It’s true—for the most part. Updating the kitchen is one of the best steps you can take to getting your house sold. A minor kitchen remodel will cost you upwards of $20,000, but you can easily recoup about 78% of what you spend during the sale.
The key to getting back most of your money is to choose a mixture of cosmetic updates alongside functional ones. For example, a fresh coat of neutral paint on the walls, an updated sink, new knobs and handles on the cabinets and drawers, and some marble, quartz or granite countertops could be an excellent addition to your kitchen. Select some eco-friendly options, like low-VOC paint or Energy Star appliances, will make an impact on the buyer, too.
Utilitarian bathrooms used to be all the rage, but these days, people want some luxury. Some want a truly spa-like experience. You may not want to revamp the bathroom and put in a Jacuzzi, and that’s fine. Change the colors, swap out dated and damaged tiles, redo the flooring (natural stone looks beautiful in the bathroom), and improve the lighting. Don’t forget the little things, like the lighting fixtures, knobs, and drawer handles.
If the tub or shower stall are old, you may want to replace those as well. Most buyers are wary to purchase a house that looks like it will give them plumbing problems.
Drafty single-pane windows are a turn-off, especially if the buyer wants an energy-efficient home. Replacing windows will have about 73% return of investment at the point of sale, too. You have nothing to lose by swapping out all the old, inefficient windows and their dry-rotted frames.
Be sure to choose a double-pane window that is insulated and made with low-E vinyl. Low-E coatings help keep the temperature from fluctuating. Not only do such windows promise energy savings, but they look brilliant, too.
Even if the floor in your home has yet to be worn down, it could be outdated. Scrap the old linoleum kitchen floor and the carpets covering the beautiful hardwood in the dining room or living room. Updating the floors around your house could make it look brand new—and prospective buyers will be thrilled. Plus, new flooring is one of the most budget-friendly home renovations you could make.
Stone flooring, like terrazzo or limestone, looks stunning in foyers and kitchens. Carpets are excellent in bedrooms. Wooden floorboards add an aged feel to the property but also a lot of charm in the right places.
Adding Storage Spots
Things accumulate. Even if you are trying to minimize, most people appreciate ample storage space. Even if your home doesn’t have the most spacious of layouts, you can get creative with adding built-in storage in unused spaces. Plus, built-in storage means cutting back on bulky furniture.
Think about adding hidden drawers and shelves in the kitchen, like a slide-out pantry; a built-in bench or shoe storage in the foyer; a vanity in the bathroom; transforming the space under the stairs; shadow boxes; and so on.
What home renovations add the most value to a home? Kitchens, bathrooms, flooring, window replacements, and storage are highly valued among homeowners. Pay attention to small details, such as energy-efficient faucets and showerheads, too. Even though the cost might seem like a lot, making these home improvements will make buyers much happier to pay for the asking price or help you when refinancing.
Thinking about adding natural stone countertops or floors during your renovations? Marble Concepts has the experience and tools to help you get the job done quickly. Give us a call or fill out the contact form to learn more.