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July 31, 2018
Renovations can be a great way to build home equity and increase the value of your home when it’s time to sell, but not all home upgrades pay off in the long run. If you’re looking to add value to your home through renovation, here are five things to consider before diving in.

  1. Additions

If you’re considering adding an addition to your home, make sure it matches the existing aesthetic of your home. Sure, potential buyers may appreciate the additional square footage, but if it looks like it was patched together as an afterthought, an addition may end up becoming a costly eyesore. If you do decide to add onto your home, ensure the proper building standards are adhered to like proper insulation. One room being noticeably warmer or cooler than the rest of the home can be a serious deterrent for buyers.

  1. Swimming pools

An in-ground swimming pool may seem like a feature that could increase the value of your home and entice homebuyers, but many times it has the opposite effect. Savvy buyers know that the overall lifetime cost of an in-ground pool is nothing to sneeze at. While the initial installation for most in-ground pools is around $40,000, there are hidden long-term costs such as maintenance, higher utility bills, and increased insurance coverage that can ultimately make a pool more of a liability than a luxury. Buyers with small children can also be turned off by a pool considering it could be dangerous for their little ones.

  1. Luxury finishes

While it may seem wise to add high-end flourishes like marble flooring or high end light fixtures to your home, the investment may not translate to your sale price. Keep in mind that your idea of the perfect upgrades may not be the same as what your buyers want. Installing a new front door is one of the least expensive upgrades you can do for your home and it gives an average return on investment of 98%.

  1. Overdoing it on one room

If you spend all of your renovation budget sprucing up one room in an older home, you may be working against yourself. A newly upgraded master bedroom and bathroom contrasted with outdated decor in other rooms only serves to highlight how much work still needs to be done. Spread your budget around to address obvious issues throughout your home to get more bang for your buck.

  1. Upgrades for the sake of upgrades

Before you start tearing down walls and going into full-HGTV mode, ask yourself how much you actually think your renovation project will increase the value of your home. If you bought your house for $175,000 and comparable properties in your neighborhood are still selling for a similar price, adding $50,000 in kitchen and bathroom remodels may only slightly increase the value of your home. Conversely, if prices in your neighborhood are fluctuating or increasing significantly, you may see a sizable return on that $50,000.

If you have more questions about how renovations can affect the value of your home, get in touch with us.

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