One of the most frequently asked questions is -" Will the renovation that we are planning add value to our home? Is it necessary to attract a buyer?" The answer is simply " It depends!"
If the roof is leaking and the gutters have fallen off - chances are you need to repair or replace them for the integrity of the structure. By not addressing these problems more serious problems are likely to occur. And, unless you were a handyman looking for a fixer-upper to buy, would you purchase a home that is in disrepair? However, if you invest a sizeable amount of money into an inground swimming pool with lush landscaping, chances are the return may be minimal - so enjoy the benefit it brings to your family, and don't worry about re-couping the investment.
The number one renovation that attacts positive return on investmnet is the kitchen, followed closely by the bathroom. New fixtures, floors and cabinets are always the sharpest update you can do to improve not just your personal enjoyment of your home, but the marketability. Fresh, neutral paint not only removes scuffs and wear and tear, but it cleans up your home.
If you are thinking about putting your home on the market, fix what needs fixed! In the event you are unable to do so, call a professional and get a written estimate. Be prepared to price your property accordingly, or be willing to negotiate with the buyer. A Buyer may be able to finance the renovation with creative financing options available more easily than you can afford up front cash to do it now. While some sellers are hesitant to do any of the improvements themselves for fear that the buyer might not like their taste, by keeping the renovation simple, tasteful and not too trendy, you should always recoup your investment.
Visit one of my favorite links at This Old House to help you calculate how much material you might need for your project - and help you budget accordingly.
I would be pleased to offer my advice on whether the renovation will improve the value and saleability of your home. Please contact me to ask your questions.
The following is a Professional Appraisal Report on Renovations and potential cost and return. This is based on a 1600 square foot bungalow in Western Canada. The data is supplied by Henderson and Butt Appraisal.
|
Renovation |
Approximate |
Immediate Value Contribution | ||||
|
% |
Amount | |||||
|
Interior painting |
$2,000-$3,000 |
80-110% |
$1,600-$3,300 | |||
|
New Flooring |
||||||
|
a) hardwood |
$9,000-$12,000 |
40-60% |
$3,600-$7,200 | |||
|
b) laminate |
$3,000-$5,000 |
60-75% |
$1,800-$3,800 | |||
|
c) carpet |
||||||
|
- average quality |
$3,600-$5,400 |
60-75% |
$2,200-$4,000 | |||
|
- high quality |
$5,400-$8,000 and up |
60-75% |
$3,200 and up | |||
|
Remodel 4-piece bathroom |
||||||
|
(new fixtures, flooring and ceramic tile) |
||||||
|
a) average quality |
$5,000-$9,500 |
50-70% |
$2,500-$6700 | |||
|
b) high quality |
$12,000 and up |
45-70% |
$5,400 and up | |||
|
Remodel kitchen |
||||||
|
(cabinets, flooring, ceramic tile) |
||||||
|
a) average quality |
$10,000-$20,000 |
70-85% |
$7,000-$17,000 | |||
|
b) high quality |
$20,000 up |
65-80% |
$13,000 and up | |||
|
Add-ons (family room, bedroom) |
$120-$170 per sq/ft |
50-80% |
$60-$136 | |||
|
Install new furnace |
||||||
|
a) medium efficiency |
$2,000-$3,500 |
75-90% |
$1,500-$3,150 | |||
|
b) high efficiency |
$3,500-$4,500 |
50-75% |
$1,750-$3,375 | |||
|
Add air-conditioning |
$2,500-$3,500 |
0-50% |
$700-$1,800 | |||
|
Add a gas fireplace |
||||||
|
a) average quality |
$1,800-$2,500 |
55-75% |
$1,000-$1,900 | |||
|
b) high quality |
$2,500 and up |
50-70% |
$1,300 and up | |||
|
Basement development |
$22,000-$36,000 |
50-70% |
$11,000-$25,000 | |||
|
(drywall finish, bathroom) |
$22-36 per sq/ft |
50-70% |
$11-25 per sq/ft | |||
|
Install new vinyl siding or stucco, insulation, aluminum soffits and eaves through |
$6,000-$8,000 |
75-100% |
$4,500-$8,000 | |||