Your Question: Should I Make Major Improvements Before Listing My Home for Sale?
Professor Tate answers this way:
It’s important to remember that simply making minor adjustments in your home (like fresh paint, new door knobs, de-cluttering, etc.) can make a difference in how soon your house sells and the price it sells for. But what about doing major improvements to your home? Would it be worth your investments?
There are some home improvements that are proven to add value to your home and/or speed up the selling process. Then there are other improvements that cater to personal taste and really don’t add much value to the house.
Some of the home improvements that add value include the addition of central air, finishing the basement, building a deck, remodeling the kitchen (updating the cabinets, countertops, appliances, etc.), and installing new floor coverings. Things like fireplaces and swimming pools don’t really add much value to your home as they tend to appeal more to personal tastes, so your return on those investments would generally be less than their cost.
The challenge then is recouping your investment. You’ll need to be careful, because when making improvements, there’s always the risk of OVER-improving your home – meaning neighborhood prices won’t support the amount of money you put into it. So how do you know how much improving is too much? It’s been found that no matter how much you improve any home, you’ll be unlikely to sell it for more than 15% of the median price of other homes in the same neighborhood. So if you have a real estate agent, you may want to ask for his or her opinion before you begin any major renovating.
What about saving some money and doing the renovating yourself? Sounds like a good idea! If you have the time and talent to do the work, DIY improvements would be the most cost-effective route. Just make sure that you don’t take on any projects you don’t have experience in or can’t handle. If you’re not experienced, it may be worth it to call for the help of a professional. Otherwise, you could end up spending MORE time and money in the long-run!
When it comes to larger jobs like heating, electrical or plumbing, don’t forget that there are local building codes that are required to be met. So even if you DO know what you’re doing, it’s probably best to have a licensed professional take care of it. This serves as a protection and will keep you from being held responsible should something go wrong after closing
Whatever you choose to do, make sure you do your research! Find out what your neighborhood will support and don’t make major improvements that won’t give you a return on your investments.
You asked, now you know!
-Professor Reel S. Tate