In today’s shaky real estate market, investing thousands of dollars in a new kitchen or deck may seem like throwing away good money after bad. (Though now that many homeowners are realizing that it may be years before they can sell their home for a profit, sprucing it up may simply be a matter of improving your own living conditions. That’s obviously a good idea only if you can afford the expense.)
To find out where in the house it’s worth spending money on renovations — and where it isn’t, we turned to the experts: remodeling contractors and real estate agents. Follow this room-by-room guide to ensure that you’re getting the most bang for your buck when the time comes to sell.
“Curb appeal” is a popular real estate buzz word – and for good reason. “Curb appeal is extremely important because people will pull up and wander away if they don’t like what they see,” says Lisa Johnson-Sevajian, a Coldwell Banker realtor based in North Andover, Mass. “It’s worth spending a few dollars on new mulch or fresh paint.”
Nowadays, many buyers are looking for outdoor living spaces like a patio or deck. HGTV has two shows, Gardening by the Yard and Ground Breakers, devoted to improving outdoor spaces. As Patrick Liska, a New Jersey-based remodeling contractor, points out, adding a patio or desk is less expensive than a home addition. “A lot of times adding onto a house won’t necessarily get you a good return, but you can remodel within your existing house,” Liska adds.
Another reason to skip a pricey addition is that over-building could mean that you won’t recoup the full value of the added square footage, because the price of smaller properties in the neighborhood can influence the larger property’s appraisal value. “You don’t want to be biggest house in the neighborhood,” Johnson-Sevajian says.
Upgrading your kitchen is another popular way to improve your resale potential. Johnson-Sevajian suggests adding storage or built-ins if possible. “Wine coolers are relatively inexpensive and make a huge impact when buyers see them,” she says. “Or little shelves or wine glass racks. It’s a low dollar investment but it creates maximum impact.”
The right appliances can also make an impression. “The worst thing you can do is have a nice house in good condition and leave it with white appliances,” she adds. “It’s the kiss of death.” Johnson-Sevajian had clients swap out white appliances for stainless steel, and they ended up selling for more than their asking price.
Tamara J. Leach, owner of Redefined Design Group Interior Design and Home Staging in Dayton, Ohio, suggests that budget-conscious homeowners consider alternatives to stainless steel. “Home Depot has a refrigerator that has a stainless look; however, it is a fingerprint-less finish for half of the price of stainless,” she says. Leach also recommends retiling the backsplash to create a new feel on a budget.
Outside of the kitchen, bathroom renovations are among the most popular (and effective) home improvements. Leach suggests updating fixtures to brushed nickel or brushed bronze and choosing neutral colors. “No themed bathrooms,” she says. “Buyers want to see a clean model home-looking bathroom now. It should look and feel like a spa.”
Rather than installing a high-end tub or toilet, Liska says the bulk of your bathroom budget should be spent on the tile and sink. “A tub’s a tub,” he says. If you do use standard tile, Liska suggest, ”make an accent to give a little design to your walls.”
If your bathroom has the space, consider adding inexpensive shelves or other storage to add visual interest and functionality.
Want to add more livable space? Forgo the game room, says Johnson-Sevajian, and finish the basement instead. “Absolutely finish your basement if you’ve got good ceiling height,” she says. “It’s a huge value-add for your property. But if it’s never going to be comfortable hanging out, then don’t finish it. Less than an eight foot ceiling feels like a basement.”
To soundproof and save money at the same time, Leach recommends intalling a basement wall system. “These pre-fab panels are installed without drywalling,” he says.
Dining Room, Bedroom & Office
Unless they’re hopelessly dated, most rooms outside of the kitchen and bathroom don’t require major changes. However, if your dining room still has an old-style chandelier, Johnson-Sevajian suggests updating. “I get a lot of impact by having sellers swap out their dining room chandeliers with new, modern lighting,” she says.
Painting is another inexpensive way to make an old space feel new again. “A fresh coat of paint is a must even if the house is neutral,” says Leach. “When you remove pictures there is a nail hole and usually a shadow of where the print has been.”
While most of these tips are not regionally specific, buyers’ tastes can vary geographically. If resale price is your main concern, it pays to check with a real estate professional in your neighborhood before calling a contractor or tearing out tile. For more specifics on how much of a remodeling job’s costs you can expect to recoup, check out Remodeling Magazine’s 2009-2010 Cost vs Value report.
Susan Johnston is a Boston-based freelance writer who covers business and lifestyle topics.