This one might be bet for the appraisers out there. What is the best improvement you can make on a home/property? New Bath / New Kitchen / New Bedroom?
Also, what is the worst. Someone once said pools were bad investments, but I don't get why. Anyone?
Real Estate Investor · Delaware · Member since 2008 · 158 posts · 10 votes
20y
I heard the same thing about pools. I think it has something to do with the amount of maintenance associated with having one. Pools have many expenses, and it may be a negative to some. On the other hand, there are many neighborhoods where, if you don't have a pool, you're looking at negative implications.
I saw somewhere a graph showing what is best for increasing values, but I can't remember where. If anyone has this or remembers, can you let us know.
Pretty sure it depends on the property. If you had a 2br / 1ba or a 3br / 1ba, I think I'd put my efforts into building another bathroom. If I had a tiny kitchen, I'd put effort into building that up - kitchens are where people spand a ton of time, and they do choose houses based on the kitchen.
I have no official stats, but this seems logical, NO?
Well, unfortunately, adding a bath or bedroom does not necessarily add value where an appraiser is concerned, except probably in the square footage. So, to answer your question, adding a bedroom or a second living area would be your best bet--which would give you the most square footage you could get in one room. Even if your property is a 3/1 in a neighborhood full of 3/2's, you really could have trouble trying to recoup your construction costs from adding that additional bath.
Residential Real Estate Broker · Chelmsford, MA · Member since 2008 · 48 posts · 0 votes
20y
Terri,
It's real hard to give you a definative answer on this. The improvement which will raise your value the most is dependant on the property and the specific market the property is in.
Is this a newer home, or an older home? If it's older, what condition is it in? Has it been updated? Look around at similar properties in the area which have sold recently or are currently listed. If most of them have updated kitchens with stone counters and stainless steel appliances and yours was last remodeled in the 70's, then you may want to remodel the kitchen. Talk to local realtors and find out what features the buyers in that area are looking for.
It really depends on the local market. For instance: here in my area north of Boston, spending 30-50k on an inground pool will not increase the value by the same amount. It's seasonal use is what we appraisers call a functional obsolescence. I'm guessing down south in say Florida, the same ingorund pool may be worth the investment because it can be used year round.
Adding square footage may help (as someone else pointed out), but be careful. Another example: In the town I live in, a newer colonial (under 10 yrs old) with 2200-2500 sqft generally sell in the mid 500's. Newer colonials with 3000-3500 sqft sell in the low to mid 600's. In this case if you had the smaller colonial and could finish a walk up attic, or put on an addition, you could bump yourself up to next price level. If you had the larger colonial and you added the same 500 sqft, it probably wouldn't help the value because there isn't a demand in this market for a 4000 sqft home.
This question needs some specific market analysis which is hard to do without detailed info on the property in question. This probably wasn't the answer you were looking for, but its the best I could do.
If you are looking to be able to list your home at a higher price (but not way off the markets price), a few things you can do that make a difference without spending thousands of dollars are:
Fresh paint (in and out)
New Carpet, flooring (tile, wood laminate, etc.)
New Fixtures (ceiling fans, lights, kitchen and bathroom fixtures).
New Blinds or window treatments.
Paint Kitchen Cabinets - or buy new.
New Appliances
Little things like this can make a big difference, especially in an older home.
I like your ideas Cathelina. These seem like easy fixes to improve your homes value. I'm still curious what improvements are considered BAD investments. Ideas?
Most improvements can only add value. As someone mentioned above, adding a swimming pool may not add much value to a home. Some people will add lavish ponds, fountains or spend a bunch on landscaping, etc. As long as the yard looks nice (trimmed) and clean there is no need to spend extra money on these type of things when you are going to sell.
If the house is old and is wood - adding siding can make it look tremendously better and raise the value significantly.
Do you have any ideas that you are concerned about? I would be glad to give you my opinion :D
Residential Lender · GA · Member since 2008 · 92 posts · 3 votes
20y
Speaking as a former appraiser, I'd have to say that adding structual changes to the property (i.e. a new bathroom, a new master suite, replacing wood siding with brick, etc.) are the best ways to add a lot of value to your property. The new pools, new carpet, new paint, new built in sound system throughout the house, etc. are what's known as 'fluff" in the appraisal industry. Yes, certain types of fluff may help with getting a slighty higher sales price for a given house, it will not effect the appraised value that much at all, if any.
As for bad improvements, I'd say avoid any extra cosmetic stuff that isn't going to increase your house's value. For example, the expensive mable counter tops in the kitchen and bath, the decortive water fountain in the front yard, the new wet bar in the living room, etc. These are all personal things that a buyer can do after they close on your house, if they want to. The trick with all of this cosmetic fluff is to put enough into the house to make it visual attractive to your buyers, but not to go overboard. You want a kind of generic look for your house, so that you are appealing to a wide range of buyers. Whoever buys your house can customize it to their liking after everything is said and done.
Down here in Florida, many communities actually require that the roof be kept clean and its not unusual for us to clean 400-500 homes at a time.
It's not being done to that extent outside of Florida yet - but it is going to happen eventually.
It obviously makes a dramatic difference in the apearance of the property. And for a fraction of the cost of a new roof (usually just a couple hundred $), I can't imagine why anyone would not do it.
BTW, with this particular development, we did 17 buildings just like the one in the previous picture. The Association was going to spend about $440,000 to have the roofs replaced because they looked so bad.
Now, three years later, these roofs still look like new even after 3 major hurricanes. And while they will eventually have to spend the money to replace the roofs, we have helped them get another 5-8 years before they actually have to do it.
For those of you that are buying and selling Apartment complexes, it would seem like this could be an extremely cost-effective improvement.
Real Estate Investor · Millsboro, DE · Member since 2008 · 480 posts · 26 votes
20y
I hear adding a deck or porch does some for the value, and it doesnt have to be that big. Especially if its overlooking water, or a nice garden/outdoor area etc. Being a porch dweller myself, I have to agree. I grill outside on my porch 4-5 times a week in the spring/summer months.
You can have a deck put on for about $1,500-$3,000 in this area, and I've heard it can add $8,000-$9,000.
Tough question. You have to look at adding value in two ways. The first is actual appraisal value in which square footage and general appearance is king. The other are items that will sell a house faster or make it more appealing. Both will make you more money.
You also have to consider your competition. Why put in granite if other houses in the neighborhood only have laminate. Why add a 4th bedroom if the rest only have 3, and why install hardwords or ceramic if the other have wall to wall and vinyl. Make sure you our not out pricing the neighborhood. The best bang for your buck is making it clean and liveable with no noticable defects. You would be amazed at how simply putting in shiny new hinges and door knobs will affect a buyer.
As for pools, having a pool here in Atlanta reduces your potential buyers by 99% so the house is going to sit much longer, much longer. Most people do not want to deal with the time it takes to maintain or the costs. Then there is the financial aspect and liability issues.
Investor · Gardiner, NY · Member since 2008 · 53 posts · 2 votes
20y
kitchens and baths are where buyers look. Adding a bath will most definitely add value. Especially when there previously was only one- add another and your investment is in a whole new category- it will attract new buyers that only are looking for homes with 2 or more baths etc.
The best bet is to think as you would if you were buying the home to live in- what would you want with the space given...
General Contractor · Scottsdale, AZ · Member since 2008 · 100 posts · 7 votes
20y
You asked - "what is the best improvement to make on a house" - you might clarify and ask to what or whom is this improvement is helping or motivating.
It depends on what you are after. If you want a higher appraised value out of a house - then do improvements an appraiser might like.
If you want to sell your house quickly to a buyer - make improvements that are WOW factor improvements.
We as investors don't sell to appraisers so why not make improvements that will sell your property to buyers.
Real Estate Investor · Amarillo, TX · Member since 2008 · 173 posts · 15 votes
18y
Everyting I have ever seen involves location and market. below are a few good links for costs vs recoup value of the major components that are typically replaced/remodelled.
Real Estate Investor · San Jose, CA · Member since 2008 · 228 posts · 13 votes
18y
Like any business, location matters. Whatever you decide to spend your money on, don't forget the landscape, if your grass is yellow, replace with new sod. You can have a nice house with fancy upgrade, but without curb appeal, how you going to get buyers in the door.