BY JAY & MICHELLE LIEBERMANReal Estate Agent with Keller Williams Realty - Westlake Village, CA
April 30, 2014 03:36 PM How Much Should You Improve Your Home for Resale Upon entering a potential sellers home we are very diligent and respectful in our assessment of what we improvements we believe are necessary, desirable and optional. People usually love their homes. They have an emotional tie to them. Telling them after 5 minutes that they need to renovate the kitchen, all the bathrooms, pull up the carpet for wood floors and telling them how much they should improve their home for resale is offensive. We are thoughtful in our assessment, take the time it deserves and show the potential client what you likely can expect from making certain improvements and what you can expect without making certain improvements. We show them the photos of the comps so they can clearly see how those comps sell in the different states they are in and equally important how long it takes to sell them. We let them choose while making our opinion strongly heard. The conversation typically turns into what will be the payback on the improvements if made. This takes some time and delicate discussion. We turn the discussion from payback to liklihood of selling and time on the market. Homes with greater improvements will sell faster typically than like kind homes without. We go over the days on market, which a lot of sellers do not pay attention to as they are focused on price. This is the point in the talk when the room lights up with all the light bulbs going off above the heads. Below you will see the pay back from specific improvements to a home as published by the California Association of Realtors
As you can see from the examples above the average payback is less than 100% and there is a message not to over renovate the home. People like to dream about their new home and what they can do to change it and make it their own. Leave something on the table for someone to do for themselves. Don't put down stainless steel countertops in the kitchen. Don't put orange high end Italian marble in all the bathrooms. Keep it simple, clean and neutral. There are various improvements that can be made for a low cost to gain. We have actually previously laid out improvements that can be made for under $15,000 that have a lot of punch!
The message here on how far you should improve your home for resale is 4-fold: 1. Do what would be desirable to the broadest spectrum of buyers. 2. Do don't improve the home in order to profit from those improvements. 3. Do improve enough to match or slightly exceed the comps that have sold for the desired number and for the shortest days on market. 4. Do improve in a way to attract the greatest number of buyers (simple, clean and neutral).