How to Increase Your Home's Value
Increasing a home's value beyond the cost of improvement can be very tricky.
If you're trying to sell, increasing the value of your home makes sense. If you’re not selling, then increasing your value may simply increase your tax bill. There are a lot of things you could do to improve the desirability of the property, but it might not affect the actual value. Very expensive projects (major remodels and add-ons) and free ones (yard clean up) alike can vary in the value they bring to the property. Planning the right projects for the right home is extremely important!
Home Improvement Tip: Keep the value of your home within 15-20% of your neighbors. Don't overbuild for the neighborhood. Pushing your home's worth above others in the area is not going to pay off. Why? Because people shop for high-end homes in high-end neighborhoods.
The following figures appeared in the January, 2018 issue of Realtor Magazine. They list the top remodeling projects undertaken to increase a home’s value in the Dallas area and what percentage of your remodeling investment is recouped at resale.
Projects that may increase your home’s value include wooden decks, entry doors, garage doors, stone veneer, minor kitchen remodels, and midrange bathroom remodels. Think twice about above-ground pools; expensive ceiling fans; garden ponds; and high-end light fixtures.
The following was the average recouped for home improvement projects in the Dallas-Fort Worth metro area in 2018:
For example, if you spend $10,000 on a minor kitchen remodel, you will be adding $8,400 to the value of your house. Adding value to your home can be very tricky! What seems to be valuable to you may not appear that way to prospective buyers.
-Remodel with mass appeal in mind. Potential buyers are usually attracted more to neutral, mainstream design.
-Don’t go cheap when it comes to construction. Use durable, quality materials. If you’re a do-it-yourselfer, honestly evaluate your ability to do it right.
-Don’t remodel in a different style from the rest of the house. Additions and improvements that look “tacked on” may detract from a home’s appeal.
-Turning a bedroom into a bathroom is a mistake – it reduces the number of bedrooms, a chief selling point.
-Don’t do a $30,000 kitchen remodel in a $100,000 house – unless you plan to continue living there. It is a waste of money.
-If you don’t sell, there are improvements that actually reduce your tax bill. Qualifying improvements are those that increase your home's value or prolong your home's life, including a fence, driveway, a new room, addition, swimming pool, garage, porch or deck, built-in appliances, insulation, new heating/cooling systems, a new roof, landscaping, etc.
If you don’t have the kind of money it takes for even minor remodeling, there are low-cost ways to increase your home’s value. At the very least, the following things will make your home more attractive and inviting to prospective buyers.
Make sure the outside of your home is spic-and-span. Clean out the gutters. Wash the windows and remove cobwebs and bugs. Trim the hedges, cut and edge the lawn, sweep the sidewalks and driveway. Plant some colorful flowers out front. The reason for these small things is simple: If two similar homes in the same are area are both for sale, the one with the cleanest and most appealing front yard will sell first.
You may want to add to or improve your landscaping while you’re at it. According to a study conducted by Money Magazine, landscaping may be the best investment to improve a home's value. The study found that well-planned, attractive landscaping was estimated to have an actual recovery rate 100 to 200 percent higher than a kitchen or bathroom renovation!
For specific advice on your home's current and potential value, please request a market analysis today for free!
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