You're ready to sell your home and you're hopeful that your investment in upgrades and improvements will distinguish your home from the others on the market. As the housing slump continues to depress home prices, more homeowners look for ways to make their homes more attractive and valuable through home improvements.
Your expectations are to recoup the investments, upgrades, sweat, and care that you put into your home. Recouping some costs can happen but keep your expectations realistic. It may be hard to accept that a $20,000 upgraded kitchen with all the bells and whistles will not be 100 percent recouped when you sell. As a reminder the market value of your home isn't based on:
- How much you added or invested in upgrades- How much you paid for your home- The tax assessed value or the balance of your mortgage
You should consider the value of similar homes in surrounding areas. Unfortunately, with the sub-prime mortgage crisis you're seeing more short sale and foreclosed homes. If any are in your neighborhood they may negatively affect the value of your home. A home's urban, suburban, or rural setting also affects its value, as does the availability and cost of new and existing homes in the immediate area.
Other factors that may affect the recovery of remodeling costs and the potential value of your home are substandard workmanship or substandard materials. Initially, it may save you money, but it may hurt you in the long run. That's not to say that all your materials have to be of the highest quality, but try to choose traditionally popular materials that will appeal to a wide range of buyers throughout the years. We don't want to offend any "do it yourself' readers, but we often see substandard work in finished basements, and it's obvious to prospective buyers. We also recommend that you obtain permits and comply with all public inspections and zoning requirements to avoid serious legal issues.
Finally, we would like to address the frequently debated issue of whether investments in swimming pools are recouped. This may vary with locations, but in our experience, the cost is rarely recovered and may reduce the number of potential buyers. While they're extremely attractive to some buyers, they raise issues for many more to include the cost, danger associated with young children, liability, insurance, and maintenance. Additionally, consider that a home pool in a neighborhood that has a common pool will probably have very low appeal to buyers.
We recommend if you install a pool you do so for your own enjoyment and with realistic expectations about their value.
According to the National Association of Realtors (NARS), 90 percent of homeowners believe their homes have high investment potential, and we agree. Homeowners who tastefully improve their homes, set realistic goals and expectations can help their home become more attractive to buyers, and sustain its value through conditions such as the current market.
We hope this helps in some manner and as always we invite your comments, concerns and questions at firstname.lastname@example.org and / or join us at the New VR SAM Military Community Forum where you can discuss any number of issues impacting military families at http://vrsam.conforums.com/.
Moving to Northern Virginia? Visit VR SAM at www.vrsam.com or call us at: 1-(877)878-7726.
As a completely free service for our Military Families, we invite you to find your new home or list your home (sale or rent) at: www.moresam.net
For complete explanation of the Remodeling Magazine's survey results for the nine regions please see www.costvsvalue.com