Homeowners who are considering a move in the near future should focus on the following upgrades per a NAR Report entitled, “Cost Vs. Value.”
As far as interior upgrades or improvements are concerned, the kitchen is the room in the house most apt to warm our hearts, stomachs, and wallet. A minor kitchen remodel, with 83% of cost recovered was one of the few interior jobs mentioned in the report. On leading exterior improvements the report found that siding replacement using fiber cement materials such Hardi plank recovered a whopping 88.1%, a new deck addition 85.4%, even vinyl siding replacement recovered 83.2%, and midrange wood window replacements recovered 81.2%.
On most projects, the value of remodeling trended down in 2007 compared with 2006. We shall see where it trends in 2008. Likely reasons why recovery costs were lower than in previous years are rising remodeling costs due to higher demand and housing depreciation brought on by the an abysmal housing market in certain locations on the country.
Some home “improvement” projects in fact may not offer much improvement at all. For example, home offices personalize a space that might fit the current owner’s needs, but all too often most buyers may not see the same value. Hey, those $20,000 in built-in cabinets look great, and they are practical for how you use that space, but don’t expect the appraiser or a buyer to give you nearly what you put into them in value on the home.
Good rules of thumb;
• Never reduce the amount of rooms in a home due to a remodeling project even if there are perceived benefits.
• Consider the condition of the house as a whole before embarking in remodeling one space. It may cause you to find that either the money spent on that one project will have a lower recovery cost due to a unbalanced condition of the house as a whole or it may cause you to spend the money elsewhere.
• Consider the value of comparables located in your neighborhood before committing to a remodeling project. Is your house currently on the high side of value for your area? Then you may get back less for the remodel compared to if your house is currently on the lower side of value for your area.
• Where resale value is a major factor in a home owner’s decision to remodel, find a home builder/remodeler and get multiple quotes to develop a construction budget. Get a Realtor to help you find comparables or sold properties that closely match the description of your home. Invest time into the project on due diligence to make sure that it makes sense.
If you need help in finding a reputable contractor or builder in the Greater Athens area please let me know! I would also be more than happy to assist in finding any information on comparables and providing a home value report. Please contact me if you need assistance in these or any matters dealing with real estate!
