Many
homeowners like to customize their homes especially when they first
bought it. They put in tons of money fixing up their home or updating
it so naturally they expect the cost to be recuperated when the time
comes to sell. Unfortunately it doesn’t work that way. Rarely will you
get your money back dollar for dollar but there are some projects that
will let you recuperate more of your costs than others.Put it in perspective. A seller bought a car for $20,000 and years down the road spends another $5,000 on repairs and maintenance so in total he has put in $25,000 on that car. He wants to sell it for $25,000 to cover all the money he has put in but would you pay that much? Probably not right? In fact, the $5,000 he spent was just to bring it up to sellable standard.
The similar concept is applicable to homes. If you are updating a torn down kitchen or room, don’t expect to recuperate all your costs. You are just bringing it up to sellable standard. When it comes to extras that you add on to your home such as maybe a center island in your kitchen or a wet bar it might add value for you but not for the next buyer. Consider this, did you put it in for yourself or with the next buyer in mind?
Lastly, you don’t want to build yourself out of your neighborhood. What does that even mean? That is when you change your home so much that the home doesn’t even belong on that street anymore. Quick example, once in a while you will see a neighborhood with small houses that are old and then you will see this brand new oversized house on a tiny lot. Sure, it is worth the price they are selling it for but then who would want to live in that neighborhood when you can get the same house at the same price in a better neighborhood where you don’t have to stand out. Therefore, think before you start adding/removing things in your house and be prepared to put that money in and not get all of it back.
I want to share the article below for you to see which projects can get you the highest return.
2011-2012 Cost vs. Value: Which Remodeling Projects Pay Off the Most?
On January 25, 2012, in Helpful Tools, Remodeling Adviser, by Melissa Tracey
By Melissa Dittmann Tracey, REALTOR® Magazine
When tackling home remodeling projects, you’ll find some projects pay off more than others at times of resale. Remodeling Magazine, in conjunction with REALTOR® Magazine, recently released findings of its annual Cost vs. Value report for 2011-2012, revealing which remodeling projects offer the biggest bang for your buck.
Overall, the trend right now is replacement over remodeling–swapping out the old for the new rather than doing a total gut job, which can be much more costly.
This year’s Cost vs. Value report found that exterior replacement projects–such as new garage doors and a new entry door–offer some of the best returns at resale, allowing home owners to recoup close to 70 percent or more of the costs of the project at times of resale.
The following are the top, mid-range projects from this year’s report, based on what home owners stand to recoup at time of resale:
1. Replacing the entry door to steel
Estimated cost: $1,238
Cost recouped at resale: 73%
2. Attic bedroom (converting unfinished attic space into a bedroom with bathroom and shower)
Estimated cost: $50,148
Cost recouped at resale: 72.5%
3. Minor kitchen remodel (including new cabinets and drawers, countertops, hardware, and appliances)
Estimated cost: $19,588
Cost recouped at resale: 72.1%
4. Garage door replacement
Estimated cost: $1,512
Cost recouped at resale: 71.9%
5. Deck addition (wood)
Estimated cost: $10,350
Cost recouped at resale: 70.1%
6. Siding replacement (vinyl)
Estimated cost: $11,729
Cost recouped at resale: 69.5%
