Six Home Improvements That Can Add Value When You Sell
One of the popular ways to build long-term wealth is to own your own home. While simply owning a home and paying down a mortgage over time will lead a significant amount of wealth creation, those that are looking to maximize the amount of equity that they could ultimately have in their homes should look for ways to improve their home. Those that are looking for home improvement projects to consider, here are six specific home improvements that could add the most amount of value to your home when you ultimately try to sell your home.
Before you make any of these improvements, you need to consider how your area will handle the upgrades. There are some instances where you can price yourself right out of the neighborhood, making it difficult to sell based on the area around you. I just want to give that warning before jumping into the improvements. Each individual market will dictate which improvements will give you the best resale value.
Upgraded Kitchen
The first improvement that you should consider when looking to improve the value of your home would be to upgrade your kitchen. Studies have shown that no improvement adds more value and return on investment then upgrading your kitchen. By installing new cabinets, countertops, appliances, and flooring, you could turn an older kitchen into a space that is highly sought after by buyers, which will make your home more valuable and easier to sell.
Square Footage Addition
The second improvement that you should consider to add value to your home would be to add square footage to your home. Adding square footage will directly add value to your home. When looking to add square footage, it would be a good idea to add space to both common living areas and to add new bedrooms, both of which would help you to attract more buyers. Adding new square footage to your home can be one of the hardest and most expensive, but if done correctly, it can really pay off.
New Bathrooms
The third improvement to consider would be a bathroom remodel. Next to improving your kitchen, renovating bathrooms provides the second best return on investment to homeowners. This is particularly true when you invest in a luxury master bathroom vanity, or other accessories to accentuate your new bath.
Open Up Floor Plan
The fourth way that you could add value to your home would be to try to open up the floor plan of your home. Beyond having more square footage, homebuyers today would prefer to have more large rooms as opposed to just a few small rooms. By knocking down a few unnecessary walls, you could greatly enhance the open feel of your home, which would add value and attract more buyers.
Finish Basement
While building an addition will add to the square footage of your home, finishing the basement of your home could add to the functional square footage. Finishing an unimproved basement will be able to give you a significant amount of extra space, which could be used to add another living room, add a new bedroom and bathroom, or even create a home office or workshop.
Outdoor Living Space
The sixth improvement that you could make to your home, which would add the most amount of value, would be to improve an outdoor living space. A lot of time renovators are focused on home rebuilding, but often forget about the yard outside. Having a nice outdoor living space will increase the usable square footage and give someone a great place to entertain, particularly during the warm weather months. By installing a nice patio, deck, or screened in porch, you could add some additional value to your home.
I am in the process of selling my home. We considered some of these improvements on our home a few years ago. After I sat down and looked at the area around me, I realized that I wouldn’t have the return on investment that I needed. As I indicated, it all depends on your area. Instead of adding anything new, I have just worked hard to make sure my house looks the best it can. Just providing a very clean and neat home can really make a difference.
Would you consider any of these improvements or have you done any?
I’ve considered moving the stairs, which sit in the middle of our vaulted “great room” that really is our eat-in-kitchen + family room. I’m not sure the investment would actually pay off, though.
Interesting. I can’t even picture that in my head DC.
We’ve been in the process of upgrading our master bath over the past six months or so and really hoping it’ll add a little something to the value when and if when we do want to sell. If we’re here too much longer we’ll also likely be adding a room to the house as well.
So I heard. I hope it went well for you. I know someone that added a room. They told me that they wished they had just moved!
Great stuff here.
We totally redid our kitchen before selling our last home. It ended up selling pretty quickly as a result.
The only downside was that we didnt get to enjoy the new kitchen that we just put in!
I hear you there Jefferson. You get excited to make the change and then don’t get to enjoy it.
I’ve never owned a home to upgrade, but I know that if I were in the market for a purchase, I’d definitely be looking for these things.
It’s always good to plan for such a thing.
We think about these things all of the time because we purchased a home that we knew was going to need “upgrades” and now we have been prioritizing when and what we do based on what we feel will give us the biggest return on investment. This summer, my hubby and his dad will actually be re-finishing the basement. I plan to blog about it, so we will see how it goes. 🙂
I look forward to reading about it. I wish them and you the best of luck with the basement remodel.
I would definitely consider these things if I was going to be selling soon, but like you said only if I had some hard evidence that there would be a return on the investment. If I wasn’t selling soon, I wouldn’t do any of these simply to increase the value. Maybe to increase the enjoyment, but the value wouldn’t matter to me if I wasn’t moving.
Great point Matt. I like to think of it in just terms of ROI. Can I make my money back or at least come damn close.
Great list, Grayson. We’re slowly getting our outdoor space redone; we poured a concrete deck last year and will be building a covered patio this year. The space can still use some landscaping help but it’s definitely a process given how expensive it is! We’re also getting wood floors installed this year, so that will improve the kitchen flooring. I’m excited about our projects and always try to think “resale” value when my husband and I discuss improvements.
Those sound like good projects Kendal. I wish you the best of luck with getting them all completed.
Whenever we do renovations, it’s always on our mind. If it isn’t your forever home, it’s a good idea to look at what’s going to get you the best ROI. And always a good idea to check out the surrounding neighbourhood (through open houses) and see what others in the area are offering. If everyone in your neighbourhood isn’t sporting high-end finishes or finishing their basements, maybe you don’t need to. And if they are, how much ‘value’ did that add to their home, compared to other sale listings that didn’t.
Great point. That is something that I am doing now. I am looking over all of the houses that sold to see what they were offering.
These are definitely all things that help when trying to sell your home. I remember when we were looking at homes back in 2009 and there were so many disaster homes that obviously had no idea what they were doing.
I remember those days. When we were looking at homes, we would walk in and then walk right back out.
We just bought our “forever home” and I agree with all of this, although we bought a house that had potential but not necessarily all of the upgrades we wanted. I would also add that a house for sale needs to be clean. That makes a huge difference to a buyer like me.
Yes, a clean house can make a huge impression. You might not have the best upgrades, but if your house is cleaned and staged, it can do wonders.
When we bought our fixer upper it needed most of these things so we plunged right into renovating it. We gutted the kitchen and main bathroom, and new flooring throughout were the major renovations we did. The basement was finished but needed new floors and the laundry room needed to be finished as well. In our outdoor space we already have a covered patio so we bought a patio set at a garage sale and a ceiling fan. That worked out nicely and very affordable. We need to replace a retaining wall in the yard and replace our front door so we will be tackling that next. I agree with you that you have to be careful not to over improve based on your location. I’m happy with what we’ve renovated so far because we are enjoying them but I don’t want to put much more money into the house.
I have read a lot about your renovations. You have some good projects going on over there Raquel.
We bought a big fixer upper, and the kitchen and bathroom were the first projects we tackled. They needed to pretty much be completely redone, but I’m sure the equity increased by more than the modest monetary investment required.
I helped a friend do a lot of work on a fixer upper. He was definitely over his head, but we did a lot of the work ourselves.
Before my parents listed our old house for sale, we completely redid both bathrooms. What a difference! I loved my new shower and I was sad to leave it. We also added new tile in the kitchen to spruce it up. Getting new cabinets and countertops was too expensive at the time, but it worked well. Paint can also do wonders.
I good old can of paint can be the best investment!
Offering an extra unit in the basement so the property generate rental income is a great plus when you try to sell. It is like getting two homes for the price of one. Not everyone likes to have tenants but the added square footage is still great for a teen kid too.
Great point Pauline. I would love to find a home where I could possibly rent out some space.
I was watching one of those home improvement shows that was trying to claim that the open floorplan is dead, and that everyone should now put up walls to separate all their rooms again. No thanks…love my open floorplan!
What show was that? I have heard everyone talk about the open floorplan. We have one and everyone loves it.
My boyfriend and I are about to start a kitchen remodel on our home in the coming months and are so excited! I actually think it adds a little more than 5% to the value if you do it right though, especially with a functional redesign. I like the idea of adding a conservatory, definitely something to think about.
I am sure it does add more to the value if it is done right. I wish you the best of luck on the remodel!
Most people underestimate the value of good looking kitchen and bathroom, which can be the home USP. We cannot take anything for granted, if we want a better price for our home than the tips you mentioned should be addressed.
I’m planning to sell my home and I followed some of the tips that were mentioned here. I considered remodeled our bedroom and improved the kitchen and living room.
I’ve had good luck asking a 3rd party Real Estate Agent to come in and provide a comp analysis and identify improvements that they can sell with an eye toward profit. So often, new homeowners think an in ground pool, as an example, is a great investment. It isn’t. It is, at best, investment neutral when you have to add in maintenance and the other hidden costs of having a pool.
Great list, these are definitely all things that help home improvements before trying to sell your home. Personally, I think the kitchen and bathroom is most important in these list.
I think the same as you. Kitchens and bathrooms return the best ROI.