Owning and maintaining a home is a stressful enough experience, but putting it on the market and getting the best price possible can take the stress to an entirely new level.
As reality television shows like HGTV’s “Buying and Selling” demonstrate, making a few much-needed—but not so expensive repairs—can help justify a higher list price, thus maximizing the potential profit gleaned from the sale.
So how far should a homeowner go in repairing a home before putting it on the market?
Sometimes only cosmetics are required such as painting, installing new carpeting, improving curb appeal, or de-cluttering and staging the interior. These are not that expensive for the return on investment they might generate. In other cases, more extensive repairs might be required in order to attract buyers at all, who will most likely be ordering a property inspection before close of escrow to locate latent defects in the structure.
“Whether you are talking about selling a home at auction, on the open market through the multiple listing service, or even for sale by owner for that matter, you will get more for the home if it is attractive to buyers,” said Rick Sharga, executive vice president at Auction.com.
Two of the nation’s largest real estate industry associations have provided their input in what repairs help the most in selling a home in 2015.
For one, the National Association of Realtors, in cooperation with Remodeling magazine, published its 2015 Remodeling Cost vs Value Report, identifying projects that add more value and recoup their costs better than others.
The report compares changes in home improvement project costs with realtors’ perceptions of what those projects contribute to a home’s price at resale. The majority of the projects expected to return the biggest financial payoff for the money spent deal with the home’s exterior.
- Replacement of the home’s exterior entry with a new steel door
- The installation of manufactured stone veneer
- Replacing the garage door
- Replacing existing siding with fiber cement
- Replacing vinyl siding
- Adding a wood deck
- A minor kitchen remodel
- Replacing wood windows
“Realtors know what buyers are looking for during their search, and curb appeal is and always will be important,” said NAR president Chris Polychron, executive broker with First Choice Realty in Hot Springs, Arkansas.
The National Association of Home Builders echoes much of what the NAR recommends, working on cleaning up the home’s exterior to improve its curb appeal.
But in an article from the NAHB titled “Speed Up the Sale of Your Home,” it also notes addressing obvious problems that are going to turn off a prospective buyer, especially if found in the bathrooms and kitchen. Of primary importance are:
- Stains from leaks
- Peeling paint
The NAHB also suggests that replacing old and outdated appliances may be a big selling point for buyers when touring a home.
“The expenses you incur on the front end sprucing up you home will be cheaper than the profits you could lose having to lower the price to meet buyer demand,” the NAHB noted.
Joel Cone is a southern California-based freelance business writer who specializes in the fields of real estate, economics and law. His articles have appeared both in print and online for many publications including California Real Estate, OC Metro, GlobeSt.com and The Los Angeles Daily Journal. He is also a contributor to Auction.com.