Major Renovations Typically Will Not Net You More Money
If your kitchen and bathrooms were last remodeled in the 80's or 90s, or are even older, you may be tempted to updated them to make your home marketable. While it will make your home more attractive and easier to sell, in the end you will not end up with more money in your pocket.
According to Remodel.com you will only recoup 77% of the cost of a kitchen remodel when you go to sell your home here in Florida and the rest of the Southeast region. There was only one project on their list that actually had a positive return for homeowners and that is adding fiberglass attic insulation. That project nets 123% of the cost on average in the Southeast states.
I have consulted with homeowners that had just spent $40,000 on a new barrel tile roof. In their mind there home was now worth $40,000 more than when they installed it. Unfortunately, it just doesn't work that way. Buyers expect a home to have a functioning roof over their heads. The reality is they will likely only recover about 70% of the cost of a new roof.
If you watch shows about flipping homes you need to understand that those people make their money when they buy their homes at below market values, do to their poor condition. They also do much of the the work themselves and are able to buy materials at contractor pricing or in some case for free in exchange for the exposure the vendor gets by being highlighted on the show.
So, you as a homeowner can gain some sweat equity by doing simple projects, like painting. Painting will add curb appeal for a relatively low cost, especially if you are able do the work yourself. Remember to stick with neutral colors. Shades of grey are popular theses days, while beige and tan colors not so much.
Landscaping and trimming is another good low cost project that will increase a homes value. It's the first thing buyers will notice when they come to view your home. Brown spots in the lawn and wild vegetation will detract from your homes appeal and can easily be fixed.
Believe it or not a new steel front door will recover almost all of the it's cost. When your think about it makes sense. A front door will get beat up over the years and its another item a buyer can't miss when they view your home.
There is one more item I want to finish up with. I don't have data on cost vs return but one repair item in particular seems to always make closing difficult. Outdated electric panels are common in Florida and many will make it impossible to insure your home and therefore impossible for a buyer to finance it. If you suspect your electric panel is very old, have it looked at by an electrician. New panels cost about $1000 and will prevent your home from failing a buyer's inspection.
Fortunately conditions favor the seller in most cases. Focus on things that will increase curb appeal without a big expense. If a repair item will prevent a home from getting financing, and is not a huge expense like an electric panel, then do it. A new roof on the other hand may be inadvisable, unless it leaks. Consult with your Realtor before doing an expensive project like that.
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