When it’s time to sell your existing home and move into a new house, you have many decisions to make. One of the most common, and complex, is whether remodeling before a sale is worth the effort.
Remodeling, even for small projects, takes time and money. Even if you do it yourself, you’ll have to purchase tools and materials to complete the task. If you hire a contractor, you’ll save money but need time for planning the project, finding the right professional, and keeping an eye on progress.
Remodeling before a sale, therefore, is a tough decision. When is it worth the effort? When is it okay to sell the house as-is?
We certainly can’t make the final decision for you, but we can provide some perspective on this common problem.
Is Remodeling Before a Sale a Good Use of Your Time and Money?
One of the main reasons that people remodel a home before selling is to increase the value of their property. However, according to most sources the money you spend on remodeling will not be recovered when you sell; in most cases you will spend more than you gain in home value.
Remodeling Magazine is one of the pillar resources on this topic. According to their annual survey, the majority of projects will not bring a positive return on your investment. Nationally, the best return was for a garage door replacement, which recovers 93% of its cost. (It costs an average of $3,907 but only adds $3,663 in resell value.)
In the Pacific region, a garage door replacement only recovered 95%, but it was, once again, the best project for cost recouped.
While it’s possible to get a positive return, it’s most likely that whatever project you complete (especially large projects) will not bring a positive return. Financially, it simply doesn’t make sense to remodel.
But that doesn’t mean it’s pointless to remodel before a sale…
Remodel to a Faster Sale
There are really two motivations for remodeling your home. The first, which we have already discussed, is to improve the sale price. The second is to help the home sell faster. Both, however, are dependent on the market.
Remodeling a home in order to sell the house quickly makes perfect sense. A home that is move-in ready, that requires no additional wait times, that the buyer can enjoy immediately, is highly attractive. Even with a DIY trend that continues to this day, many buyers appreciate the convenience of moving into a home that needs minimal care and attention.
Focus on Small, Simple, Fast Projects
When considering whether or not you should remodel before a sale, it’s best to break it down to what projects you should complete. Generally speaking, the projects that have the lowest cost and shortest completion times will be ideal when remodeling before a sale.
Ugly, Worn Paint Color
If your house needs a new paint job, either because the existing paint is faded, cracked, and old, or simply because it’s an out-of-style color, it may be time for a new coat. Any “accent walls,” (a fading trend of making one wall stand out from the rest) that are overly bright or colorful, should likely be painted over to a more neutral color.
Simple Landscaping Maintenance
You don’t have to bring in truckloads of fill dirt and retaining blocks; a simple layer of fresh mulch or rock, along with some quick trimming and mowing, will do the trick. Take an afternoon to clean up and refresh the exterior space and your house will give a strong first impression to buyers.
Simple Kitchen Upgrades
Everyone wants to have a first-class renovated kitchen. This is true not only for homeowners, but homebuyers as well. If you really want to attract a top price for your home, a good kitchen is important. But these projects cost money, and they rarely bring a full return on your investment. Therefore, it’s best to focus on small visible improvements, not an entire kitchen overhaul. Painting the walls, replacing dented cabinet doors, and updating the countertops are all simple and affordable kitchen upgrades.
In a Hot Market, Remodeling May Not be Necessary
When you are considering whether remodeling before a sale is a good idea, keep one element in mind: the market. In a buyer’s market, where there are many homes for sale and buyers can select from a wide variety of houses, you may want to remodel to help set your property apart.
Having a fully upgraded property with new paint, fresh landscaping, and a finished basement may help attract the best buyers.
On the other hand, if you live in a hot market like San Diego, remodeling may not be necessary. In fact, it may be a waste of time. Unless there are serious and significant issues with the home, you will likely find a good buyer who is willing to purchase at a fair price. Remodeling the kitchen or painting the walls may not be required.
Bottom line: the hotter the market, the less likely you’ll need (or want) to renovate.
No Matter What, Make the Home Attractive to Buyers
Regardless of the market, you should make the home visially attractive to buyers. Focus on the “curb appeal,” as well as the “screen appeal,” to ensure that buyers are flocking to you home with a positive first impression.
For this, it’s not so much remodeling, but simply cleaning and updating. Simple tasks like mowing, cleaning, repainting, and removing debris from the yard will all help you sell the home quickly, at a price that is fair to everyone.
Whether you remodel before selling or not, it’s important to make the home visually attractive.
Affordable Remodeling and Purchase Loans
If you need a mortgage for your next purchase or a loan for your remodeling project, we are here to help. Contact our team and let us help you find the right loan for your unique needs!
