Remodeling your home? It’s a big decision and one that you should not take lightly. There are many factors to consider that a lot of homeowners ignore when planning their remodeling projects. The biggest general mistake is to make project decisions in a vacuum – forgetting that your local real estate market will ultimately be the judge of how successful… or how big a financial failure your project was.
A good example would be a homeowner who wants a pool. After all, they have school-age children who have lots of friends over and what a good time they would have in the new pool, right? Besides, putting in this backyard “Oasis” will surely add value to the home. Or at least that’s the premise. So, the homeowner goes through all the time, effort, and expense to put in a $100,000 pool with a nice little waterfall. If they lived in a vacuum, this would be a very happy little scenario.
The problem is that these homeowners failed to account for the fact that they live in say Boulder, Colorado, and that no one in their neighborhood has a pool – maybe for good reason. They also forgot to analyze the fact that their HOA already has a community pool for any of the residents who are so inclined. The issue starts to come into focus now… these homeowners have lost a lot of money.
The point is that remodeling a home can be tricky business – particularly in today’s real estate market. There are scenarios where certain projects make a lot of sense; the trick is to know which ones they are and to avoid the kind of scenario illustrated above. Here are a few tips to help you make this big decision:
Don’t make improvements solely because you want to or because it solves a temporary need. Always consider how the local market will react to your home after project completion.
Don’t undertake major remodeling projects just to sell your home. Unless you are actually “curing” a major deficiency – like adding a Real Estate Marketing Ideas For Social Media 2nd bath to a 3-bedroom home, or adding a garage in a neighborhood where other homes have garages – it’s usually a bad investment.
If you do make improvements to your home, make them in moderation and keep them on the generic side. It’s always amazing what a difference just paint and new carpet can make.
Start outside and work your way inside. From a value perspective, if you have a great house but it looks Companies That Get Your Home Ready To Sell like the Adams Family house from the outside, painting the den should probably not be the top priority.
Try consulting with a real estate professional before you make any remodeling decision. We recently consulted with a homeowner who had made some classic mistakes – like putting in an elaborate (and expensive) stage in his basement under the theory that his kids liked to be in plays at school. Needless to say, it turned out to be a pretty bad financial decision as potential buyers not only saw no value in the “stage” project, they universally saw it as a negative and lamented how much it would cost to get rid of it. He actually paid for it twice.
If you’re considering remodeling your home keep in mind that many projects only return a fraction of their cost. You may only get 80% of the cost of that new kitchen back at re-sale, but if you enjoy the improvements for years in the meantime and they ultimately help your home sell faster, probably not a bad deal.