The Covid influence on real estate continues to be unprecedented. Not one pundit or economic expert predicted or could have predicted how the pandemic set the housing market on fire. Sellers hit unexpected jackpots but not all need or want to become buyers. Many are remaining in place, working on and improving their homes. Their concerns? What provides the best return on investment for homeowners?
The best improvement to any home is one that makes it work better for the owner. What’s the point of spending money on something if it doesn’t bring joy? This is “value in use”; and it’s different for every homeowner because every owner has different
requirements for their home. The best improvements are valued by both the owner and the market (the buyers), and in our sales and appraisal experience, those below tend to be well received.
Add Gross Living Area
It’s our opinion that the best improvement to any home is additional living space. Finished basements, bonus rooms, additions, tend to provide the best return on investment. Consider the additional flexibility offered; these areas can be a home office, exercise area, rec rooms, teen suite or any number of uses. A properly equipped basement can function as an in-law suite offering options for elders, boomerang kids or even Airbnb. If a total rehab is on the board, expanding up or out can be a game changer. A complete renovation allows for a chance to change the design and floor plan and to bring an older home to current standards. Know, however, appraisers and FNMA DO NOT consider finished basements in the overall living area figure. The areas add value, but they are considered as "finished basement". Functionally similar and usable but considered separately. Don't fire the guns; that is a FNMA rule and appraisers are required to abide by it.
Kitchen & Baths
The heart of the home is always a good area to work on; here we’re talking kitchen and baths. These tend to be major jobs but a complete kitchen update (cabinets, counters, fixtures, appliances) is almost always well received. Same for bathrooms, they remain an area that many see as a “refuge” and we find that a well-designed update is recognized by buyers. Partial updates are an option; refinished cabinets can complement new counters and appliances. Design and consistency is key, everything needs to flow and work together.
Paint & Appeal
First impressions matter, fresh paint and other cosmetic enhancements are universally beneficial. Paint is easy and almost everyone has time pushing a roller around, it’s almost a rite of passage. This is one area owners can play with; that mural of Venice or hot pink bedroom that the owner loves can easily be neutralized if the home is offered for sale. Regular exterior paint is a good idea to avoid maintenance issues; its money well spent as it protects and beautifies.
Pools & Hardscapes
In ground pools have exploded since the pandemic began, companies are stacked and it may take months to get one installed. Yet these remain a love-hate as far as the market goes. Some love the appeal of a pool; others prefer the yard space and recoil when considering safety and maintenance concerns. More universal in appeal are outdoor areas like porches, landscaping, kitchens and BBQ areas. Under deck drain systems can open up a previously unused area and incorporate it into the landscape.
Routine maintenance is critical with every home; things wear out and need to be replaced. There’s nothing sexy about high efficiency HVAC systems, spray foam insulation or thermal replacement windows but there can be benefit to upgrading from basic builder grade levels. But be smart; the idea that solar panels, smart T-stats and similar items increase value is often a sales pitch. There’s insufficient data to support most of these these claims. Most of the "research" is done by the companies selling these items. How well any of these items might work depends on the design, age and characteristics of the home. Until/unless credible data shows buyers paid "X+" for a "green" home, these claims are suspect.
Work around the home should first benefit the owner and make the home more enjoyable and usable. It’s critical to understand marketing pitches making outlandish claims. How dopey is "paint your door this color and add 5K to the value of your home". Can things like a high efficiency HVAC system save money? Yes. Can a pool or a putting green add appeal? Yes. But value is subjective; will a buyer place a priority on them and pay more for them?
Questions? Of course. Drop us a line, we'll talk with you and provide opinions based upon data. This is all we do.
The Hank Miller Team puts 30+ years of full time sales & appraisal experience to work for you. Act with complete confidence & make sound, decisive real estate decisions. 678-428-8276 and email@example.com Posted by Hank Miller on