Home sales are projected to be on the rise in 2020. Current homeowners are trying to find ways to increase the value of their home and pocket as much money as they can. Everyone from home flippers to long-time homeowners are trying to find ways to increase the values of their real estate. Unfortunately, there are many misconceptions about how to raise home values. As hard as it is to believe, not every effort you put into selling your house will give you a return, much less a significant one.
In this post, I will explain some ways to increase your home value.
The kitchen is the most trafficked room in any home. Many have claimed that kitchen remodels are almost guaranteed to raise the price. This is still largely true, but not everything you do in the kitchen will raise the home value. For instance, upgrading only a few appliances may lead to a non-uniform layout of the kitchen. Imagine having a silver refrigerator right next to a white microwave. No one designs a kitchen like that and the kitchen will look lazily designed. If you are updating a single appliance, the priority should be to make sure it matches with everything else.
Adding more counter/storage space tends to raise home values, but only with a good design. Many people add an island to attempt to raise the value of their home only to find that the kitchen does not appeal to potential buyers. You must make sure there is plenty of work space. But more importantly, you must make sure the kitchen work triangle has no obstructions. A kitchen work triangle is a triangle linked between the refrigerator, stove, and sink. This is hands down the most trafficked area in the kitchen and adding an island could easily disrupt at least one pathway. The person working in the kitchen will be handling hot, sharp, and dangerous things frequently in this space. The last thing someone working in the kitchen wants is to worry about anything coming between them and their work.
Update The Kitchen, Avoid Full Remodeling
The more you remodel the kitchen, the less likely you will increase the value of your home to your liking. Updating too many appliances may leave areas skewed and even show that the appliances do not fit with the kitchen design. One of the best pieces of advice I have heard is that you must choose the appliances before designing the kitchen. Chances are the people who originally designed the house (if it was not you) heard this too. They chose the design around their appliances. If you want to change the appliances too much, it is more likely you will need to change the kitchen.
It does not take too much to update your kitchen. Sometimes a fresh coat of paint of the same color is all it takes to make your kitchen appear modern. Many colors come and go and none guarantee a raise in value of the home. It is not uncommon for kitchens to require a remodel though. Upgrading cabinets and adding counter space may raise values considerably.
I am not an expert in home design, you should consult a designer to find how to improve your kitchen. However, my family commonly included a form of counter space called a kitchen peninsula. Unlike an island, this feature is not independent, but counter space that is part of some already present counter space. My parents, aunts and uncles have these in their homes and enjoy them. If properly implemented, these peninsulas will not interrupt the kitchen work triangle like some islands do. Apparently, peninsulas are great ways to improve kitchens to raise the value of your home.
Implement More Usable Space
Another common way to raise the price of the home is to add some square feet to the house. Some people add additions to their home. However, with the average cost of addition of $48,000, the increase in value to your home is not likely to provide any return in investment. These additions must be well implemented and designed in order to receive a return on investment.
There are less expensive ways to add usable space. You can finish a basement for less than $30,000 for an equivalent addition and quality of usable space.
Open Floor Plan
Some experts claim that another way to increase house space (or at least perceived space) is to make an open floor plan. An open floor plan is where the first floor has very few walls and it is more like one large room. First of all, this does not add much usable space, especially for the cost. Second, if anything this tends to lower home values.
There was a time when open floor plans would increase the value of your home, but that time may be over. The open floor plan has many flaws including lack of privacy, carrying sound, etc. The truth is, the open floor plan was popular for my generation when they were young and wanted to entertain. When my generation got older, they recognized 1) the value of privacy and 2) they do not entertain often. The closed floor plan is regaining popularity and if you are selling your home, trying to go with an open floor plan will not only cost money, but will likely decrease the value of your home.
Whoever said all that matters is what’s on the inside never tried to sell anything. The exterior is the first thing any potential buyer will see. It is imperative to make sure the house looks appealing.
Cleaning the exterior will add significant value to your home. In fact, the National Association of Realtors says that washing the house can add $10,000 to $15,000 to the home value. Make sure to clean the sides with a power washer and to wash the inside and outside of all windows.
Like your kitchen, fresh coats of paint will do wonders for the exterior. Landscaping will make the home look new and plants will help.
Make The Home Low Maintenance
If you ever had to clean your house, you probably have an idea of the efforts it takes. You probably even made upgrades to put in less effort for cleaning. Owners are more likely to buy a house with upgrades that do not require much cleaning.
Some upgrades can make your home low maintenance and safer. Stripping down wall paper and painting the walls can prevent the formation of molds, which are not only unclean, but potentially a health hazard. Replacing carpets with hardwood floor require less sweeping. Also if there are pets you are less likely to deal with “excrement soaked floor boards.”
Make The Home More Efficient
One trend that seems constant is the green trend. Potential buyers want efficient houses, whether to improve the Earth or their wallets. One of the best ways to make your home more efficient is to add insulation. The costs for installing such insulation are barely over $1,000, and that would include professional installation. The resale value of the home can increase by as much as 6%.
There are other green improvements such as adding energy efficient appliances including heating and cooling systems (kitchen appliances have been mentioned above). Some real estate investors have advised me that these upgrades may not always be worth the investment. Such improvements frequently cost between $2,000 – $5,000 and a full HVAC replacement costs between $5,000 – $10,000. These improvements are only worth the investment if the systems are severely obsolete or broken.
Very Crucial Step: Inspect The Home
This is kind of cheating because I have mentioned that there are 5 ways to improve your home value. This will not necessarily increase your home value, but ensure it.
One of the most crucial steps to make sure you get the value from your home that you want is to order an inspection for your home. This is one of the least exciting steps to ensure you sell your home. Frequently, the least exciting steps are the most important. Home inspections make sure that your house is not a fire hazard or that the roof will not collapse on your home. Hopefully, you do not have to make any major repairs. If you are in the home selling process it is better for your inspector to find these issues before the buyers’ inspector.
Most buyers can ignore small cosmetic flaws in the kitchen or floor plan. They can easily pay for the changes they desire. How many buyers will ignore a fire hazard or collapsing roof? Next to none. These repairs may not be any more costly than any changes in cosmetics, but the typical buyer would rather buy an unappealing house that they feel like will be around tomorrow than the perfect looking house that they are not sure will be around tomorrow.
Can You Skip The Inspector?
Even if you hired an inspector before you bought your home, you may need to have another one check the home again when you are selling. The longer you had the home, the more likely an inspection is a good idea. Like it or not, the world is changing, and so is your home and the land your home is on. Even a little water can damage the foundation and structure of your home.
Most of the problems that would be severely detrimental to a sale is not as costly as you may think. Major roof repairs do not commonly exceed $3,000. Unfortunately, major repairs require time to fix, sometimes months. The earlier you find it, the earlier you can sell your home. Unless the buyer is a flipper and you are willing to sell for a much lower price than you desire, no one will buy a house that would require major repairs.
If you skip on the inspection and the buyer notices major problems, you have just wasted time and money. Chances are the loss of opportunity you just took negated any and every return of investment you put so much effort in to make more money from your home sale. Before you try to make your home more appealing, you need to be sure it is a place people want to live in.
Sellers are frequently excited to sell their home. That can make them overexcited to take unnecessary steps to try to increase the value of their home. While many steps will raise the value, not all of them provide a return of investment that is worth the cost.
More importantly, there are many other steps that are far more necessary to ensure that you will sell your home for a suitable value. Unfortunately, many people skip on making sure that their house is suitable to the typical home buyer. That may cost more than ignoring the appeal of the property. Take this advice into consideration if you want to sell your home to forge your wealth.