In the midst of such a crazy sellers market, it’s important to look at some home improvements that won’t necessarily ADD much to your home’s value.
What is an appraisal and how does it determine the value of my home?
A licensed appraiser will set the value by creating a report based on a thorough visual inspection, using recent sales of similar properties, current market trends, and aspects of the home (like the amenities, floor plan, and square footage).
* Buyer Tip! * – If you are financing the purchase of a home with a loan, typically your lender will be the one to make arrangements and order the appraisal. They do this to insure that they are not over-lending (lending more money for the sale than the property is worth). Generally, the amount of money a lender is willing to loan you, is based on the appraised value of a property, not the listing price.
Home improvements that won't actually add much to your home's value
Before investing any time or money in improving or updating your home, it’s important to start by taking a look at the surrounding properties. If you’re working with a licensed Realtor®, they can easily pull up this data and run a comparative market analysis for you. This will help you see how your home compares in terms of features, upgrades and amenities, and will give you an idea of what the appraiser will be using to set the value of your home. (Check out the competition, if you will.)
Investing in improvements like adding solar panels, extensive landscaping, or even a pool won’t always have a good ROI (return on investment), especially since these are typically pretty costly additions. Even if every other house on the block has these additions, your initial investment to “keep up with the Jones’”, may not be recouped upon the sale of your home. Think about it in terms of dollars going out (to complete the projects), and dollars coming in (from the added value, and sale of your home.) Your licensed agent will be able to offer advice and suggestions on this topic, pertaining specifically to YOUR home and the current market.
Even projects that may seem smaller, like replacing all of the carpet in your home, or upgrading to new appliances won’t always have a good ROI either…
For example, let’s say you spend $5k+ on replacing the carpet throughout your entire house. While it may make it ‘look better’, especially for photos and showings, it doesn’t automatically add $5k to the value. Besides, consider that some buyers may plan to rip it all out and install wood floors or tile anyways! Now, having worn carpet certainly doesn’t do you any favors, but with the hot market we’re in right now it may be best to spend that money elsewhere in updating your home.
Work with us: Solid Realty Group
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