October 13, 2020
So you’ve decided that it is time to do some renovating before you put your home on the market. You haven’t decided what exactly to do yet but you want to make sure you only spend your hard-earned money on renovations that will give you a return on your investment.
No one wants to earn less on their home than what they paid for it in the first place. Real estate is supposed to be an investment in your future and an asset that gets more valuable with time. The only problem is that the property does age over time. Homes experience normal wear-and-tear that needs to be worked on. Then style trends change over time that need to be updated to entice your ideal home buyers.
To make sure that you only spend your time and money renovating things that will increase the value of your home, try not to waste time on too many surface level features. Chances are the new home buyers will be making changes upon moving in anyway. c
You’ll want your home looking bright, open, neutral, and clean (to allow the new potential buyers to be able to easily imagine their new lives in the home). Focus on a few important areas that will make all the difference.
Renovating usually costs homeowners less than remodeling because it’s about repairing or updating home features and appliances. Homeowners will likely see a better return on investment on renovation projects than on remodeling projects when they sell their house because of the upfront costs. Potential buyers will be turned off if your roof leaks and the central heat and air don’t work, so you’ll be better off focusing on those important details than on building a giant luxury deck on the back of the home.
Renovations can increase the value of a home and help the homeowner make a profit, but it needs to be the most important renovations and it needs to be done well in order to get that return when it’s time to sell.
It’s a great idea to have the Realtor that you are going to work with on selling your home weigh in on the changes you want to make before you start investing in them. A good Realtor will know just what buyers in your area are looking for and what home features will help sell the property the quickest.
If a renovation of a home’s kitchen is more on the luxurious side, the return on investment likely won’t even out. If you are doing a renovation on an outdated kitchen for the purpose of selling the home at a higher price, you might consider a midrange remodel as your best option. This type of renovation typically costs between $20k and $64k, depending on materials that are chosen and how big the project is.
Definitely change out appliances as your first concern as it is a big selling point to have energy-efficient models that will also save you money while you are still in the home. To keep costs low you can see about changing out the cabinet doors instead of tearing down and replacing the cabinets, and choosing midrange materials instead of the highest priced options that your contractor will likely suggest (although be sure not to buy the cheapest options either – stick with the midrange prices to get affordability as well as quality).
When budgeting out your kitchen remodel expenses, estimate that the labor costs will be about ⅓ of the cost, cabinets will be about ⅓ of the cost, and the last third will go to flooring, backsplash, sinks, countertops, and new appliances.
Expect midrange bathroom renovations to cost you between $5k and $15k and up. Like with kitchen renovations, you’ll likely see a higher return on investment from a midrange renovation than a luxury bathroom renovation. Again, this will be the best option for you if the goal is to get your return on investment by upgrading the bathroom.
This typically includes taking out the flooring and replacing it with ceramic tile, updating the sink, fixtures and countertops, and updating the vanity or cabinetry, lighting, and more. The costs for bathroom renovations will vary greatly depending on the size of the bathroom – whether it’s a small half bath, a guest bathroom, a master bathroom, etc. You’ll want to consult with a contractor to determine the costs based on your preferred budget and renovation priorities.
Rest assured that it will be worth it as nice bathrooms are a top priority for home buyers. Also know that bathroom renovations, like any renovations, may require permits before the projects can begin, but they are likely inexpensive.
If the outside of the home looks undesirable, potential home buyers are not going to be interested in seeing the inside of the home. This might even need to be the main focus during renovations to get buyers interested in the first place.
Outdoor home renovations could cost anywhere from $5k to $15k or more. First make sure that the actual home exterior is in need of renovations to get the most curb appeal. Consider if it needs a paint job, new siding, or a new garage door. Next make sure that the front yard is tidy and in good condition. If you need to hire landscapers that could cost around $1k to $6k, but would do wonders to attract ideal home buyers.
Don’t bother with decorative accents until the structural details are taken care of, especially if the purpose of the exterior renovations is to sell the home, since the new homeowners likely won’t have your same taste in decor anyway. Talk to your Realtor about what is likely to sell best in your neighborhood before you start renovating to make sure that what you are investing in will be worth the effort.
For more on what to do to your home to get ready to sell, check out this article on 10 Things You Must Do Before You List Your Home.
After you are done renovating, if you need specific information on how to stage your home before buyers take a look at it, see How to Stage Your Home to Sell for Top Dollar.
If there is still a lockdown in your area at the time you are selling your house, make sure to check out Coronavirus Real Estate Guide on how to safely sell or buy a home and work with a Realtor.
Renovating your home for top dollar can be stressful, but it doesn’t have to be all negative. Have fun with it since it is an experience – and one that will likely benefit your bank account immensely after you’ve sold your home for what it was worth, which will feel great as well. Don’t forget to take the guesswork out of what kind of renovations you’ll need to do by talking to a seasoned Realtor in your area.
If you’re looking to sell your home in the Sacramento area, contact us soon at Quantum Real Estate.
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