As a homeowner, you might ask: Will renovating my property actually increase its value? And perhaps more importantly, will I make a return on investment when the house is sold? Read on as we explore these topics in more detail and the renovations that will give you bang for your buck.
What does “value” look like to you?
The goal of any home renovation is to add value. However, value can come from two places: a financial return on investment when you sell OR a space that brings you comfort and pleasure. You may recoup a portion of the money you’ve spent on new materials and quality finishes, but if you upgrade to a chef’s kitchen because you love to cook, well, that’s a worthwhile investment too.
Should you renovate?
You should base your decision to renovate on two factors: your budget and whether your home requires work. If you’re just looking for a project to keep you busy, we’d recommend against making any major changes that could set you back financially. It’s difficult to know what a restoration will be worth to a prospective buyer as we all have different needs, tastes, and opinions.
Your home’s resale value will also depend largely on the state of the housing market at the time, the property’s location, access to schools and entertainment, etc. You don’t want to spend thousands of dollars on a spa-worthy bathroom only to sell to someone who demolishes it in favour of a laundry.
However, it’s always worthwhile investing in your home (if you can afford it), especially if you improve the appearance of the property or the structural integrity of the building. This will also eliminate potential problems in the future when it’s eventually time to sell. Fixing a leaky roof, tending to water drainage, inspecting the state of your foundation, and working on your curb appeal will stand you in good stead when you put your house on the market. You’ll be that much more likely to get your asking price (or more!)
Which renovator are you?
Are you renovating the house because you’re about to sell, or are you hoping to make it yours having just moved in? Or are you wanting to update certain areas that require a bit of love and attention?
If you plan to sell, your focus will be on changes that will make your property a more attractive purchase, hopefully securing better offers with few days on the market. Whereas, if you’ve just bought your house (or it’s in need of a makeover), you will prioritize upgrades that cater to your likes and lifestyle.
For example, if storage in the kitchen is limited, you might invest in a butler’s pantry. Do you love entertaining outdoors but hate gardening? Convert the backyard into a deck for patio days and barbecues. The goal of any custom home renovation should be an improvement to your quality of life.
However, if you know this isn’t your “forever home,” it’s better to keep things simple and not too specific to your taste. For example, think twice before covering the walls and cabinets in dark moody tones or painting the hardwood floors black. These alterations may not appeal to the next buyer, and it could lower your property’s value significantly. Be strategic when choosing fixtures and finishes, and always have your end goal in mind.
Renovating before you sell is a great idea if you have obvious issues to fix, such as a derelict fence, faulty garage door, or water-damaged siding. However, if you’re trying to impress potential buyers with a few cosmetic changes, it’s best to consult an experienced real estate professional before going ahead. We’re told that bathrooms and kitchens sell homes, but no matter how much you spend on paint, tiles, and granite countertops, there’s a buyer whose taste in bathrooms differs from yours.
Renovations that will increase the value of your home
These changes (or upgrades) will improve your quality of life and are more likely to have a positive impact on your resale value.
1. Painting A fresh coat of paint on your walls is an easy way to transform the look of your house, especially if you fill in holes and chips while you’re at it. Stick to neutral colours that will make your furniture pop and have broad appeal.
2. Replacing windows If your drafty windows are pushing your energy bills, it’s time to swap them for new, energy-efficient alternatives. Not only will it improve your home’s appearance, but it will also save you (and future owners) a significant sum of money in heating and cooling costs.
3. Add storage If there’s one thing you can be sure buyers will appreciate, it’s extra storage space. Whether you put a cleverly concealed cupboard in a dead space or a few shelves in the garage, this smart home renovation will grab attention.
4. Finish the basement While it’s no small task, finishing your basement adds valuable and useable square footage to your home, especially if you include a bathroom.
5. Mend fences Not only does a fence give you privacy and security, but it also adds to your curb appeal when it’s in good condition. Find out more about checking the state of your fence here.
6. Upgrade to smart technology Smart devices or appliances increase your home’s security and save you money on energy costs. It’s also unlikely that any prospective buyer would look down on these upgrades, so it’s worthwhile investing in smart locks, smart thermostats and water leak detectors.
7. Seal your driveway This extends the lifespan of your driveway and makes it look shiny and new instantly. It’s also a task you can do yourself.
8. Repair caulking or grouting This small change can make a big impact, especially if your budget is tight. It also shows that you care for and maintain your residence.
9. Neaten up the garden The first thing any prospective buyer sees is the outside of your home. Win them over with a well-maintained yard, driveway, and exterior as this implies that the interior is just as impressive. Cut back overgrown bushes, plant flowers or greenery in bare patches and create a great first impression.
When is it best not to renovate?
Do you plan to complete the home renovation yourself? Remember that while certain projects are simple enough to do on your own, major facelifts should be carried out with the help of a professional and experienced team. If you don’t have the budget to hire someone, a time-consuming and expensive refurbishment may not be wise.
In a situation where your property is outdated and requires a total modern makeover, it might also be better to sell as is (but at a lower asking price). Restoring an old home can uncover a nasty plethora of issues, and it will drain your resources quickly.
Lastly, if you’re still considering a revamp but you’re unsure where to start, speak with a real estate agent or broker. These individuals have an insider’s knowledge of the current market trends and buyers’ needs. They can guide you on what sells, what will increase (or decrease) your property’s value, and what would be a worthwhile investment of your time and money.
Remember that the goal of a home renovation is to make your life easier and more enjoyable. If it doesn’t, it’s not worth the effort.
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