Not every home renovation pays off when you sell your house. Some homeowners are surprised to discover that their $100,000 renovation didn’t improve their home’s value by the same amount. They expected to earn back that investment, and perhaps more than that, when they sold the house a few years later.
You can avoid that disappointment by seeking the expertise of a real estate agent before you begin the upgrade on your home. As a trusted realtor in Ann Arbor, homeowners often come to Alex Milshteyn for guidance on getting the most value out of their home renovations.
Getting a Bigger Return on Your Investment
According to Alex, it often makes sense to do additional work on your home, besides that bedroom addition or kitchen remodel you’re planning. While a renovated master suite may provide the serene escape you’re dreaming of, homebuyers are looking for a complete package that’s move-in ready. You may not reap the benefits of a renovation unless you make updates throughout your entire home.
“At one point, I had two identical homes right next to each other,” Alex said. “In one, they put in a brand-new $75,000 kitchen and stopped there. The one next door, not only did they put in $75,000 for a new kitchen, they also invested another $100,000 throughout the rest of the house. That second home got back more money than they put into it, but the kitchen-only home only got $0.50 for every dollar they invested. Every buyer who walked into that property said, ‘It’s a great kitchen, but we’re going to have to do X, Y, and Z to it to update it.’”
Buyers today are willing to pay a hefty premium to have a house that is done and beautiful. Houses that require any work—even painting—will sell for noticeably less. While a decade ago, buyers were willing to put in some work on a home, today they want the entire house to be move-in ready. “You may think that painting is cheap and easy to do,” Alex said, “but buyers today are overwhelmed by even the smallest tasks.”
To increase your return on investment, consider the types of updates that a typical homebuyer will want to see. Get to know the pulse of the Ann Arbor market, and watch for signs of popular trends years ahead. Also identify any trends that will soon go out of style. A realtor can help you separate the signals from the noise.
Guidelines for a Bigger Home Sale
If you plan to sell your home in five or ten years, you will benefit by selecting a design that will appeal to homebuyers when it’s time to sell the property. You don’t want to spend your money on a project today that will require a major overhaul in a few years. For example, pink granite countertops were in style ten years ago. Today, pink granite is out of style, while white and black are in. Replacing a granite countertop after just a few years is a costly fix.
Alex also advises tempering your design choices. Importing exotic tile from Spain may not pay off when you sell your house in a few years. Not everyone shares your bold design aesthetic, and most people won’t value the expensive imported furnishings that you appreciate. Instead, it’s best to stick with classic elements that a wide population of homebuyers will be delighted with.
Be thoughtful about your color choices. You may love fuschia, but it isn’t everyone’s favorite color. While you can repaint your walls, installing fuschia cabinetry will reduce the resale value of your home.
While every home is different, Alex said there are some renovation safe bets for the next few years. His top four recommendations are to update your kitchen, bathrooms, flooring, and paint. “When anyone asks me about investing into their property, that’s what I always recommend,” he said.
Get Trusted Advice
If you’re considering a home renovation and might sell your house within a few years, talk to a real estate agent before you begin your project. “I always appreciate it when clients say, ‘Hey Alex, this is the tile we want to put in our property. Do you see anything here that maybe we should look in another direction? What’s the resale value on the things we want to do here?’” Alex said. “I always enjoy it when my clients ask me what they should do with their property.”
He also recommends working with a design-build company that can help you make smart design choices. “It’s so important to work with a good designer like Giraffe,” Alex said. “They can help you think about what a timeless style looks like, because what’s in style today won’t be in style ten years down the road. You’ll just have to redo it when it’s time to sell the property.”
If you’re looking for a nuanced design that will yield a bigger sale on your house, Giraffe can guide you from start to finish. Let’s talk about how to make that happen for you!home renovation, home sales