Renovating your home is necessary especially when it improves the quality of living. Home improvement projects which are implemented for the purpose of increasing the house?s value however, is an altogether different animal. Indeed, some projects do improve the value of your property but others are just basically draining your wallet. How do you distinguish if a project adds more value to your home?
Where to start:
You need to know first the appraised value of your house. Knowing this beforehand will enable you to have a basis for comparison with regards to your planned improvements. Be very careful, there is only a slight difference between improving your property and out-pricing it from competition.
In other words, if you put so much money into improvements for your home that yours has a significantly higher value than all the other homes in your neighborhood; you have out-priced your home for resale. You won?t be able to demand for the entire amount that your house is worth if all the other houses nearby are priced considerably lower.
How would I know if I am already out-pricing my property?
The gurus in home marketing concur that the guideline is to never upgrade your home to more than twenty percent higher than rest of the homes in your selling radius. Listing your home for sale at a price that is twenty percent higher than your comparable competition is the absolute highest that you can go. The upgrades which consist the twenty percent surplus has to be substantial.
For example, if the twenty percent reference for the value of your house is $30,000 then you will be risking a potential loss of $10,000 if you insist on proceeding with that $40,000 improvement project that you are planning. On the other hand, you will be turning in a nice little profit if you are able to convince potential buyers that the value of your improvement is $30,000 when in reality it?s only worth $10,000.
What are the other considerations?
Some remodeling or home improvements can be just too personal. For example, you may be very excited about the idea of putting in a hot tub, but would a potential buyer be as interested in it? Some expensive improvements are purely personal preference and your potential buyer may not have the same priorities so you may lose a sale or not get the money you need because of this improvement.
Can?t Miss improvements:
There are a few home upgrades however that seem to be favorable to almost everyone. Upgrading the kitchen or bathroom and having an additional room that will substantially increase the floor space of your house is pretty safe. Landscaping is quite possibly everyone?s favorite so it?s pretty safe. It creates a fine impression thereby possibly influencing the overall value of the property.
Needed equipments like a new furnace or necessary items like an electrical system are not really improvements but fall under the category of ?must?. These are items that may have to be rectified on a new contract. Having updated fixtures, hot water heater, furnace, roofing repairs and more along these lines will draw a buyer to the home. If you are considering new carpeting it needs to be very neutral so it will appeal to everyone.
Before considering any updating or home improvements it is always to your benefit to consider all the angles first.
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Source: http://www.oklahomawindows.net/revenue-earning-home-improvement-projects/
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