Since the housing collapse of 2008, many people have found themselves uncertain about what is in store for the housing market in the coming years.
Although the nation has seen some of the hardest hit cities begin to rebound in value, many people are still wary about whether they will be able to sell their homes let alone qualify for mortgage financing for their potential new home.
These uncertainties have lead people to upgrade their homes in the hopes of some day finding a buyer, and also to make their extended stay bearable until the time is right to sell. During the sub-prime years of lenient lending guidelines and Loan-to-Value ratios well above 100%, (with the help of home equity loans (HELOCS) of course) we saw people spending money on upgrades that proved worthless in the end. Some additions and upgrades that are believed to increase the value of your home will actually add additional expenses, or make the home too unique to market to the masses. The following is a list of tips for what not to do when upgrading your home.
Although this is an upgrade that is specific to people who have the space and zoning that allows for a swimming pool, the addition is an amenity that appeals to a small range of buyers. Swimming pools are not only expensive to build, but are also expensive to maintain. Take into consideration your location, the demographic of your area, and the average income of the potential buyers before deciding to move forward.
Add a Hot Tubs, Whirlpools, and Saunas
Hot tubs, whirlpools, and saunas are common expensive additions that many think are going to be useful and will add value to their homes. Just like swimming pools, these amenities are thought to be valuable until about 5 months after they are installed. They require costly maintenance and will lose their appeal with time.
Create Larger Common Areas by Eliminating Bedrooms
If you need more space, do not take down a wall that makes a legal bedroom. Home appraisals are based on many variables, and the amount of bedrooms is critical to the value of the property. If you need more space, convert the bedroom, (without tearing down the wall) into a den so that it will still be considered a bedroom at the time of sale.
Mix High End with Run of the Mill
You have probably all seen this before, a home with high end appliances (Sub Zero, Wolf, Bosch, etc.) and low end, run-of-the-mill cabinets from Home Depot. A savvy home buyer will know the difference between custom cabinets and cabinets that were pre-sized and fabricated. With that being said, keep the quality of your fixtures and appliances consistent. Something high end will only make the cheap stuff look even worse.
Include Extravagant Lighting Fixtures
Remember, the goal is to sell your home eventually. If extravagant lighting is your forte, it will probably only be liked by a limited or select number of potential buyers. Keep it basic: make upgrades, but focus on appealing to the masses to assure the upgrades are timeless.
Select Uncommon Colors and Décor
Stick to neutral colors: do not go overboard with bright colors or busy wallpaper. To sell the house, you will most likely have to repaint these walls in neutral colors and remove the wallpaper. If you chose not to do so, it will show in the listing photos and defer potential buyers before they even see the property in person.
You have stuck it out this long in a home that you probably thought you were going to sell in 5 years, so do not decrease your chances of finding a buyer when the time is right. Think long and hard about the upgrades you want to make and be sure they will be favorable to the largest pool of potential buyers to avoid lowering the value of your home.