Let’s say you know you are going to be selling your house in the next three to five years. However, the homestead is feeling a little dated and tired.
Why not do some home improvements now and do so in ways that will maximize resale potential?
Double Whammy!! In a good way — you get to enjoy those improvements for the next few years while still recouping some of the costs through a higher value when you sell.
This strategy is even more important today than it used to be. Over the last few years, the trend has been for remodeling projects to provide a lower return on dollars invested. Ten years ago, $10,000 spent on a kitchen remodel might gain you $12,500 in value. Today, however, that $10,000 will likely only increase the value by $7,410.
How can we know that number so precisely? By tracking the yearly survey conducted as a joint venture by the National Association of Realtors and Remodeler Magazine. They conduct surveys in 35 cities across the country and Denver is one of them. And the latest survey reveals that kitchen remodeling has an average return of 74.1%.
So…spend $10k today on a kitchen remodel. Enjoy it for a few years and get the buyer to pay $7,410 of it when you sell. You’ll probably get way more than $2,590 in enjoyment from it while you continue to live in the property.
The first step is to get the report on cost versus resale value of 35 home remodeling projects. The stats are pertinent to the Denver market in particular.
You can get this report here for free.
The cosmetic choices you make when you remodel can also improve the average return on dollars spent on remodeling. The average return in the survey is just that – an average. If you make wise choices, you might beat the averages.
You shouldn’t always let impact on resale-value guide your decisions. If you’ve always wanted that two-level master bath with pink polka dots on zebra stripped painted walls, go for it. However, to the extent that you can enjoy things that have more universal appeal, you’ll be better off when it comes time to sell.