Should You Renovate Your Home Before Selling It? In Today’s Market, It All Depends
Renovating your property before it sells can make a difference. But in markets where buyer demand is strong, it might not matter. With housing inventory at historic lows in many parts of the U.S., you might be hoping to capitalize on the market by listing your home. After all, it’s ready to go; you have a new roof, fresh paint, mulched beds, and you even planted flowers. But what about that dated interior? Should you update your home before listing it?
That depends. There are many reasons to update your home if you’re able to do so. Many buyers today want a turnkey opportunity—a home in move-in condition. An updated home may also compete better against others on the market, especially new construction. Perhaps most importantly, first impressions matter. Many buyers see your home first online, so a home that presents better may spark more interest. Remember, your first showing is done before the buyer ever walks through the door.
Stay away from big renovation projects. If the entire house needs to be updated, make the presentation as good as it could be - clean, neat and organized - . Don’t worry if the house doesn’t match up to the latest design magazines. An older home that’s well cared-for shows it was loved and will attract the right buyer at the right price.
In many markets, inventory levels are at record lows and buyer demand is strong. While buyers will compete for available homes in any condition. In hot markets like South Florida or the Hamptons, renovations may not be necessary. There’s no inventory, so there are bidding wars on available homes, whether they need work or not.
What To Consider Before You Renovate
Update things that pay you back: While doing a quick kitchen or bath remodel might be tempting, you probably won’t see a return on investment when you sell. According to Remodeling Magazine’s 2021 Cost vs. Value Report, projects that improve a home’s curb appeal provide the most return on investment for sellers. A garage-door replacement, with an average cost of $3,907, for example, recouped 94% of the cost at sale, according to the report, while the installation of manufactured stone veneer on the exterior returned 92%. A minor kitchen remodel, on the other hand, generated a 72% return. “The exterior curb appeal has a strong psychological effect on people, setting buyers’ expectations as they walk through the door,” said Clayton DeKorne, Remodeling’s chief editor. “If they start out with a strong first impression, they’re in a better frame of mind to pay a higher price.”
Get a home inspection: The buyer will hire an inspector as part of the due diligence process once the house goes under contract. But sellers can benefit by getting their own inspection up front. Know your property and the condition of the mechanicals, and make sure it’s all in good working orders. That way buyers can focus on the presentation of the house instead of little things that are out of line. If the roof needs to be replace go ahead and file an insurance claim and replace it. A savvy buyer is going to ask you to replace the roof so why wait.
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