How much is too much when renovating a home?
Over the years I have had many clients buy, plan to renovate, but decided to hold off because they were comfortable in the home. Then, when it came time to sell they seriously considered making improvements just to get a higher dollar amount for the home.
A home owner never see’s a dollar for dollar increase, just overall improvement and some added value. Some of my clients bought in 2006 and shortly after, the market started to head downward.
A few years later they wanted to sell and couldn’t even ask what they paid for the home due to the declining market. The homes needed some improvement and even if they put those dollars into the home they still wouldn’t come out ahead. At times, improvements will simply justify your asking price not command a higher one. I’ve had this conversation with too many clients and don’t enjoy delivering the bad news.
Buying a home is a major investment as we all know and having a knowledgeable agent guide you from the very beginning is paramount. I sit with buyers all the time and talk about the home they have interest in, what their plans are for the home (and future) , how long they plan to stay, the benefits of certain improvements, and the current state of the market.
I’m definitely a believer in improving renovating a home for your enjoyment because after all, our home should be our castle. There is definitely value in the enjoyment of the project. You will have to seriously consider how long you plan on staying in the home. If only a short time then you are probably better off leaving it as, unless you got the home for a great price and certain improvements will help you get a higher dollar amount when it comes time to sell.
Kitchens and bathrooms are typically a smart improvement but be careful not to over improve. You can spend $10,000 or $100,000 on a kitchen renovation, it depends on your taste and the quality of the finishes.
Finished basements are another big topic of conversation. Finished basements are a great way to have additional space for the family and entertaining. There is definitely value in that but in terms of legal square footage it should only be counted if the basement is above grade and has a legal egress.
You can always call a local appraiser in to talk about how they determine value and adjust where necessary. It’s always wise to do your research in the beginning then to wish you had later on. In Maine, You can contact the local code enforcement office in your town and inquire about local codes and requirements.
Let’s pull into the driveway of the nicest home on the block. Many buyers shy away from the nicest home on the block due to the fear others are not following suit. Before buying the home pay close attention to the neighbors and look for pride in ownership.
This is most likely the most important purchase you will ever make, take as much time as you need to do your research. An informed decision is a sound decision and most likely one you won’t regret.