The 3rd of 12 posts in a
series of Frequently Asked Questions about the real estate process from the
sellers' point of view.
Answer - Well there are two
areas in that question that need different approaches. If there is a major
defect, such as major foundation settling that is causing major cracks, I’d say
get that fixed or be prepared to make a major concession on price. There are several
companies that can give you an estimate for any and all repairs that your house
may need repairs, it is important that you know what the costs of those jobs
would be, so that you have a firm negotiating position for any price
concessions that you may have to make. That is probably another reason to have
that Home Inspection done before you list, if you know that there are major
issues.
Other things are really issues of aesthetics. For such things as
an ugly tile in the bathroom or kitchen or really bad wallpaper on the walls of
a bedroom don’t do anything. I’d advise that you only fix those things
that can be done cheaply and mostly with “sweat equity” (such as re-painting a
room). The other items that might fall under aesthetics may cause the buyers to
factor in the cost to have them fixed, so you should have some idea what they
may cost, but don’t worry about them yourself. Most buyers will come with a
list of things that they want to change and that are really their issue, not
yours. Aesthetics issues are usually not show stoppers; however, the need for
major updates or upgrades, or the need to replace a major mechanical system
usually is for all but the bravest of buyers and even they will ask for a big
discount on the price to deal with those issues.
Certainly don’t put major money into things like a new kitchen or
bath if you are planning to sell. You will not get your money back. It is a
common mistake that most homeowners make that they start “adding on” the costs
of the improvements that they’ve made over the last few years to what they
think they can get for the house. It’s not going to happen. Even the best
updates only usually return about 70% of the cost, according to studies done by
the remodeling experts.
The other common mistake that sellers make is thinking
that the money that they dumped into a new roof a couple of years back or the
new furnace this last year should be considered as updates. They are not
updates, they are maintenance that is expected to maintain the old value, not
enhance it. New windows may be considered to be an update, but even that is
something that most buyers expect that an owner would have done anyway to
maintain value. Updates and major remodeling projects enhance value and should
be planned into home ownership about every 3 - 5 years.
Click here for some good reading at the How To site
on the return on investment for home improvements. Hopefully you made those improvements
and updates for your own enjoyment and you had some time to enjoy them. If not,
don’t do them now. Get over it and move on.To get a better idea of the
potential costs, visit the Home Remodeling site and read their 2013 Cost vs Value Report.
One area that you may also want to address is the outside of your
house. Here are some great tips for outdoor
projects that do add value. Your
lawn and landscaping are also areas that can
So, the bottom line is that it is way too late to start doing
major updates when you are getting ready to sell your home. It makes as much
sense to do that now as it would to stand on a corner giving away $100 bills
and getting back $50-60. How long would you do that before the light bulb came
on?
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