Home Improvements That Can Actually Lower Home Values
It’s a common idea that renovating and upgrading your home will automatically increase its value, right? Not necessarily. Despite the recent housing craze of buying, renovating, then flipping homes for an incredible profit, not all home improvements are created equal.
Contrary to popular belief, some home renovation projects can actually decrease your property’s value. For you, this means that you could lose money if you decide to sell soon after completing your home improvements.
Why is this? There are several reasons that can explain this reality. Firstly, some projects cost a lot of money to complete, but the perceived value of that project to others is not equal to the investment required. Secondly, buyers may not consider that the type or scale of your renovations match the value that you allot to it. Finally, there are other projects that look great, but may require continued upkeep or costs to maintain which buyers are not willing or able to expend.
That leads us to the question: which projects can decrease your home’s market value? Here are some to keep in mind:
When in doubt, ask a trusted real estate agent and your local contractor and appraiser for their opinions and advice about your home improvements before starting them. This will help ensure that your sweat equity and hard earned dollars are used to the greatest advantage.
by Shalimar Albanese on Jan, 2014
Contrary to popular belief, some home renovation projects can actually decrease your property’s value. For you, this means that you could lose money if you decide to sell soon after completing your home improvements.
Why is this? There are several reasons that can explain this reality. Firstly, some projects cost a lot of money to complete, but the perceived value of that project to others is not equal to the investment required. Secondly, buyers may not consider that the type or scale of your renovations match the value that you allot to it. Finally, there are other projects that look great, but may require continued upkeep or costs to maintain which buyers are not willing or able to expend.
That leads us to the question: which projects can decrease your home’s market value? Here are some to keep in mind:
- The overly ambitious landscaping project: One of the most tranquil and pleasing aspects of a home can be its well-manicured lawn or the eye-catching garden and shrubs. However, too much of a good thing can simply be too much. As beautiful as it is, landscaping requires continual work and cost to maintain it at its peak. If you have overpriced the value of your landscaping, then you could actually discourage potential buyers from even making an offer. When it comes to your front and back yards, you want keep up with the Joneses only, not outdo them.
- Brother, can you spare a room?: Another potential home improvement pitfall centers around the conversion of a spare room, whether it be in the main part of the home, the basement, or the loft above the garage, into livable and usable space, or conversely, removing an existing room for a more open feel. For example, decreasing the number of bedrooms may look more aesthetically pleasing to you, but potential buyers may have preferred that extra room. Likewise, adding more space may sound appealing, but it depends on what changed to create that space. Larger structural changes of any kind will make a buyer ask “Why?” Make sure you answer that question upfront with a reasonable answer.
- Quirky can be…”interesting”: Your home is your personal space, so it makes sense that you would make changes, such as unusual paint colors, to make it your own. However, when it comes to selling your home, any unique changes can decrease your home’s market value. While a paint job may not seem like a lot of work to change, potential buyers will think differently – it would be just one more task to complete in the process of owning a home, and cause them to offer a lower asking price than you would like. Before putting your home on the market, make your home as neutral as possible so that potential buyers can see themselves in their home and not in your home.
- Do-it-yourself projects that weren’t done well: Home improvements cost money. And they can cost a lot more money when you hire professionals. Therefore, it’s no wonder that many people try to do the work themselves. But take care that you do the work well; what may seem like a decent job to you may look unprofessional to an objective eye. Before undertaking any renovation project, make sure you understand how to complete a quality job so that your home value increases, not decreases. Also remember that property records list the original structure of the home along with the legal changes that have been made.
When in doubt, ask a trusted real estate agent and your local contractor and appraiser for their opinions and advice about your home improvements before starting them. This will help ensure that your sweat equity and hard earned dollars are used to the greatest advantage.
by Shalimar Albanese on Jan, 2014
