Like many of us (raises hand), maybe you spent a little too much time over the holiday season binge-watching HGTV makeover shows. With the spring home-selling season quickly approaching and your head full of all kinds of brilliant design ideas, you’re thinking of diving head-first into a major home improvement campaign to get your house ready for sale in the coming months. It’s the fast track to big profits, right?
These shows make it look so easy. You dump a boat-load of money into knocking down walls and adding the latest fancy upgrades, and suddenly your house doubles in value and you walk away a hero. But slow down there, tiger. There’s a lot more to the story.
First, let’s consider the financial aspect, a.k.a. the boring and responsible part.
How are you going to pay for these improvements? For many people, this involves a significant drain on their personal savings. Even worse, maxing out their high-interest credit cards. What happens if the improvements don’t pay off? What if your home ends up sitting on the market for a while? What if an unexpected family crisis hits when your money and credit lines are tied up? You may have just dug yourself a big financial hole that can take years to recover from. For now, let’s put the financial talk on the back burner. We’ll come back to smarter approaches to this in a minute.
OK, now let’s talk about the fun part: playing designer.
This is where many people get themselves in trouble.
It’s so easy to walk into a home improvement store or product showroom and be dazzled by all the amazing options for flooring, fixtures, countertops and more. All of a sudden, you’re thinking how much better every nook and cranny of your home would look with this or that update. Surely, these will all add value to your home, right?
While the options are endless, the fact of the matter is that not every update or improvement makes sense for your particular home or neighborhood. In fact, in many cases, you’d be throwing good money away or even turning away potential buyers by making the wrong choices.
Here are a few things we have learned in our many years navigating clients through the “to improve or not to improve” quandary:
Who exactly is your target buyer?
Is it a first-time or move-up buyer? Does your home and neighborhood appeal most to young professionals, families, empty-nesters, multi-generational households or retirees? What features are most important to these buyers? Are they expecting high-end finishes throughout or are they mostly interested in getting the most usable square footage they can afford? If you’re not sure, ask around or do some online research to educate yourself on the current situation in your area. Make sure your design choices appeal to them, not necessarily to you.
Get help setting a smart and realistic budget.
Over-improving a home is a sure-fire way to lose money on a deal or miss out on potential buyers who are now simply priced out of the home. Finding the sweet-spot between marketability and profit optimization requires a level of expertise most homeowners lack. (And no, watching a lot of HGTV does not automatically make you a home improvement expert. Sorry!) Getting the advice of an experienced agent is best way to come up with a strategic game plan and budget to achieve your goals.
Focus on high-return improvements.
Industry research shows that there are certain design features that have the biggest impact on sales price and time on the market. For example, a recent Zillow Digs analysis found that listings featuring keywords like “subway tiles” or “barn doors” can sell as much as 13 percent higher and nearly 60 days faster than homes without those features.
Similarly, listings including quartz countertops or Shaker cabinets saw significant boosts. But, again, these payoffs will vary greatly by neighborhood. While your target buyers may appreciate these features, they may not be willing – or even able – to pay extra for them.
Two words: broad appeal.
There are certain home features that we know appeal to the widest group of potential buyers. For instance, updated kitchens and baths are typical “must haves.” Also, as a general rule, open floorplans with clear sight-lines appeal much more to today’s buyers than cut-off compartmentalized rooms of generations past.
While you may love ultra-modern finishes and bold colors and patterns, these are very taste-specific and may turn off the average buyer. Save the choices that scream “you” for your next home. In order to market to the masses, sometimes you need to go the safer route, even if it stifles your inner design nerd.
Embrace what already makes your home special.
Remember what made you fall in love with your home in the first place and look for ways to enhance and highlight it for the next buyer rather than completely reinvent the wheel. Maybe it was the charming historic touches in an older home, especially in a desirable established neighborhood. Or maybe it’s the clean lines of a mid-century modern that has now come back into style.
Improving on what’s already there can make for efficient use of your home improvement dollars. Again, this requires some community-specific know-how to understand what is truly unique and appealing and what is just dated or weird.
Alrighty, so now you’re ready to get started, knowing that you want to make certain strategic improvements so your home is positioned to sell quickly and for the best price. How do you finance these upgrades?
That’s where Avenue3 Realty comes in. Our team of real estate agents and home improvements work together to handle all the necessary work to get the home in prime selling condition with zero up-front costs to sellers! We advance the funds to make the upgrades at 0% interest and no payments until the home is sold. We can even help advance additional funds needed to help with things like mortgage payments, rental housing or moving costs, whatever is needed to make the process smooth and stress-free for you. We’re paid at the close of escrow and you get to keep the net gain in equity.
We believe this unique low-risk, high-reward sales strategy empowers homeowners to make the most of their most valuable asset – their home.