How to Maximize Your Return-On-Investment (ROI) for Home Sale Preparation.
Alexandria, VA – Hi Alexandrians! It is hard to believe that summer is waning, and we are moving on towards apple cider and Halloween! As we move into Fall, a busy time for most, some of you may be eyeing a home sale in the near future. A common question, we, the realtor community, are often asked is “What improvements should I do before I sell?” Often, The Seward Group is invited to the seller’s residence to tour the home and advise them on this part of the process long before they are ready to sell.
The NAR (The National Association of Realtors) puts out an annual remodeling impact report which estimates what percentage homeowners are likely to get back in sales price from various home improvements/ updates: (summarized below by the Virginia Association of Realtors)
NAR’s Remodeling Impact Report: What Makes Money in 2022? – Virginia REALTORS®
We, here at The Seward Group, don’t subscribe to home improvements being a truly quantifiable equation. This is because, as much analysis as any group or individual can do, this isn’t really how buyers decide to purchase a home. The decision to purchase a home, in our opinion, is an emotional one. We can see the buyers face as they enter a home that they can envision living their lives in. Of course, economics are a huge factor, we just aren’t sure they are quantifiable.
You will notice in the link above that there is a joy score for home improvement projects and a cost recovery estimate chart for both interior and exterior projects.
According to these metrics, refinishing or installing hardwood flooring, putting on a new roof, installing insulation and a new garage door are the only home updates that bring the owners 100% plus ROI.
We believe that the following refresher decisions gain our sellers the biggest ROI on their investment, and we recommend these for every home sale, provided the seller is willing to do them. We have heard it said that for every $1 a seller spends in home sale prep, they will get $2 back, however, we can’t quantify that either. We do believe that for every dollar spent on the recommendations below, you will get $1.50 back.
Always keep in mind that the market fluctuates…interest rates change, economic conditions change and just like life, timing is everything in real estate. We can’t control any of these factors, we can’t control the competition or the housing inventory level, we can only control price and condition. The seller always picks the sales price, with professional input from their realtor.
Consider doing the following before putting your home on the market: Curb appeal is everything – you need to get buyers in the front door! You never get a second chance to make a first impression
- Landscape cleanup – fresh mulch, flowers, edged beds, weeding, etc.
- Power wash walk and driveway
- Paint the front door
- Paint the interior and exterior as needed
- Refinish hardwood floors as needed
- Deep clean inside the home
- Clean windows inside and out – let the sunshine in
- Refresh bathrooms – glaze tubs white that scream 1950-1970, replace outdated lighting fixtures and vanities.
- Refresh kitchens if outdated by having cabinets professionally painted and updating the hardware. Update the countertops if needed.
- Replace outdated flooring with LVP (Luxury Vinyl Plank) which is very inexpensive and can really transform a space.
- If the roof is old, consider replacing it – if that is not an option, consider hiring a roof cleaning company – cleaning does wonders for an aging roof.
Market dependent, we do not recommend doing extensive remodeling right before selling. Price overcomes all objections, but if you are thinking of selling in the next few years, why not consider updating your home now, so that you can enjoy it, instead of simply doing it for the new owner. Why shouldn’t you get to have a high joy score?
What additional questions can we answer for you?
We are here to assist in every way with all of your real estate needs and questions.
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