Kate’s lost it.
This makes no sense. Improving my home adds value! How in the world could this be a financial danger? I can’t possibly lose money by making an improvement to my home, can I? Oh, yes… it is so SO easy to under- or over-improve your house, and it happens ALL THE TIME.
I must admit, even I was a victim of the over-improvement bug in both our renovations. In Renovation #1, it was the master bathroom that did me in. It wasn’t a big bathroom, so I wanted it to pack a punch. Sure, it looked nice when we finished it, but do I think the house would have sold any faster or any higher if I hadn’t spent $4,000 on quartzite tile and a glass shower enclosure? Nope, and it would have saved me hours of back-breaking work! When we sold the house, we were happy with the profit we made, but an extra $4,000 would have been nice.
Renovation #2 was a much bigger project.
We were rehabbing the entire house plus adding on 400 square feet, and with the property situated on five wooded acres down a private drive, we tried to renovate with high-end buyers in mind. This time it was the kitchen that tugged on our purse strings. My husband wanted those cabinets with built-in pull-down racks and a pop-up mixer stand. I thought a dazzling subway glass tile backsplash would cinch the deal. The kitchen turned out gorgeous and functional, but we found that we rarely used our fancy built-in cabinets and potential buyers didn’t even notice them. And while the glass tile was beautiful, a ceramic tile backsplash would have looked just as nice at about half the cost. These weren’t huge over-improvements, but, again, I don’t think the house would have sold faster or higher if we had chosen less expensive features.
It is very common for owners to over-improve their home.
I knew a lady who bought all new stainless-steel appliances for her single-wide manufactured home because she read about how this would raise the value. Without having a resource like a trusted REALTOR® in your back pocket, homeowners are generally under the impression that whatever money they put into their house they will get back at the closing table, and that whatever they love about their home every buyer will love. To make matters more complex, neither contractors nor real estate agents will give you a straightforward answer; hearing “Don’t do it – you won’t get your money back!” is just as common as “This is your home! If it will make you happy, have at it!” From a practical standpoint, you need to ask yourself: Is this my forever home? and do I have money to waste? In most cases, the answer is no. Sure, when you sell your house and deposit that closing check of, say $150,000, you’ll be happy! But wouldn’t $170,000 be better?
Let’s not forget the dangers of under-improvement.
“New” does not mean “better.” I once showed a house with all new kitchen cabinets that looked like they belonged in a garage!
I heard of an inexperienced rehabber who took on a historic home, ruining it with vinyl trim and laminate floors; I think it ended up in foreclosure. While this is an extreme example, it serves as a reminder that if you’re going to update a home, do it right! Don’t try to save a few dollars by installing fake-brass doorknobs or booblights!
I live in Hidden Springs, and most of the homes in my neighborhood were built within 10 years of each other during the early 2000s. At that time, granite countertops were standard, and now quartz countertops are all the rage. If I wanted to sell my house, would it be worth it to upgrade to quartz? Consider the comparables. Both the buyer’s agent and the appraiser are looking at comps in your neighborhood. If all the homes your house is being compared to have granite counters, it’s simple to see that upgrading to quartz would not be a prudent investment. On the other hand, if your Hidden Springs home happens to have laminate countertops, upgrading might be worth the investment considering the standard in the neighborhood.
With home improvement being a fine line, what should you do if you want to renovate?
Whether you plan to hire a contractor or do it all yourself, call a real estate agent first! As both a REALTOR® and a rehabber, I have a proven intuition of how to get the biggest bang for your buck. Even if you aren’t planning on selling your home anytime soon, I would be happy to see what you’re working with – opinions are free and non-obligatory.
And if you want the best over-improvement story of all time, call me!