Unsure of whether or not to renovate your home before you put it up for sale?
This is one of the most frequently asked questions in the real estate market. The answer isn't as straightforward as it seems. Some homeowners have seen good returns on their investment while others have taken a loss.
Here’s what you need to know about renovating your property before listing. That way, you can add real value and maximize your profit.
Increase your bottom line
You may question what benefits renovation can bring you. Since you’re moving out, you won’t be able to enjoy the changes you make. Plus, some people view them as a headache, so why would you even consider spending your money this way?
The answer boils down to the value of your home. As many as two thirds of all metros reached double digit price appreciation in Q4 of 2021. Now imagine what investing in renovations could do to your home value.
By investing in the right renovations, you'll boost the value of your home far beyond the money you’ve spent, if done correctly. With pre-sale renovation services, you avoid the headache and increase your profit.
This means that you can increase your bottom line when negotiating with potential buyers. On top of that, you’ll receive even more offers with higher sale prices, meaning that the power is within your hands to earn the most profit.
Turnkey houses attract more buyers
Buyers in general want to purchase a move-in ready house. After all, with a historically low housing inventory, buyers are competing for a limited number of turnkey houses. In turn, this increases the demand for the limited supply of houses that meet this criteria.
As such, you can make your property stand out by focusing on the right renovation projects. Even small and affordable changes have the potential to make an enormous impact. According to a recent study by the NAR, 7 in 10 millennial buyers -- which currently make up the largest market share -- would be willing to sacrifice space for a move-in ready home. In fact, most recent buyers who purchased new homes were looking to avoid renovations and problems with plumbing or electricity at 36%.
Look for turnkey to remain the top buyer preference as millennials and younger demographics value move-in readiness.
Put in the Time up Front, Benefit Down the Line
If you’re concerned about time, you may be tempted to list your property on the market right away in the hopes you’ll receive a quick offer. However, you’ll find that even the simplest of renovations can help your house sell faster once it’s put on the market. Renovations can instantly make the job of any real estate agent much easier by allowing them to showcase the full value of your property. This inevitably means you’ll not only receive more offers from buyers, but higher quality offers at that.
Now that you’re equipped with the knowledge of what pre-sale home renovations can offer, let’s take a look at the most effective renovations you can work on to earn the most profit.
Key renovations to focus on before listing
The National Association of Realtors (NAR) knows a thing or two about selling houses. Here are 3 renovations that earn a 100% return on investment or higher.
- Update your flooring
Hardwood floors are all the rage and seem to transcend time. A hardwood flooring refinish can earn a 147% return on investment. Adding hardwood floors can earn about 118%. However, in some situations even laminate over carpet can have a profound impact for a fraction of the price of hardwood floors.
- Insulate your house
Whether you live in a warm or cold climate, it’s important to insulate your house. Buyers love this energy efficient upgrade, which recovers 100% of the cost, paying for itself.
Also, in many situations these additional renovations can be very effective. It comes down to thinking like a flipper by using the right materials and the right finishes for your area.
- Fix what’s broken
Before you start brainstorming an HGTV-level renovation, it’s important to start with the basics. Fixing what’s broken is a great first step to bring back any value your home may have lost. You can begin by doing a simple pre-listing home inspection. Are your HVAC machines working property? Are there any damages present on your roof? Is there a broken doorknob or a section of busted drywall anywhere? These simple yet crucial renovations aid in boosting the attractiveness of your home.
- Invest in an interior paint job
Giving the interior of your home a fresh coat of paint can result in a 1-3% increase in value. With very little upfront cost, this is a great way to bolster your bottom line without spending big.
This kind of visible value all throughout your home will serve as a constant reminder to your prospective buyers and can really entice them to make an offer. However, you’ll want to make sure your paint aesthetic doesn’t conflict with a buyer’s aesthetic. Try to go for as neutral of an aesthetic as possible when choosing a paint color. Earth and natural tones are usually your best bet for universal appeal.
- Remodel your kitchen
An undesirable kitchen can quickly suck the enthusiasm that any prospective buyer may have for your property. That’s why you’ll want to consider making at least minor renovations to this space before you list.
Even without shelling out tens of thousands of dollars, a 2021 report showed that a midrange, minor kitchen remodel could help you earn a return on investment of nearly 72.2%. Such renovations include painting your cabinets rather than replacing them, taking out the most energy inefficient appliances, and replacing countertops rather than changing your entire kitchen layout.
Renovate and enjoy the upside
Though the list of renovations to focus on wasn’t extensive, we understand just how complex renovating a home for profit can be. In fact, we know that most homeowners miss out on 15-20% of the value of their home. That’s why at Revive, we’re here to help you prep like a professional. With our expertise and network of professionals, we’ll help you construct a detailed renovation plan that fits your budget and exceeds your expected ROI. Our simple 5-step process will ensure you maximize the value of your home so you don’t leave any money on the table.
Ready to start renovating efficiently today? Let’s schedule a 15-minute intro call to get moving.