Understanding HOME Value

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It is extremely important to understand what truly brings value to your home. Regardless if you're trying to sell, refinance, or plan a remodel, knowing the things that bring the most value to your home will give you the best bang for your buck and return on investment. What you may perceive as desirable or an "upgrade" can be a complete turnoff for a potential buyer. These are the upgrades we have to unfortunately have to label as "preference" and in turn do not contribute much to your homes overall value. When I say the word "value" I mean MONEY. Dollar amount. Dinero. Benjamins. You get the idea. Let's dive into the the big ticket items.

What is your return on improvements?

If you plan out your upgrades, you can expect home improvements projects to cost 25 cents on the dollar out of your pocket. The other 75 cents spent go directly into your home by way of increased value. Even if you are a tight timeline, take time on these improvements and do not cut corners. If you are working with a realtor, ask to meet in order to put together a selling plan that will enable you the time to take care of your improvements in the most effective way possible.

Before you go about making these said improvements or upgrades, sit down and make a list. Categorize the items you want to address by how much it will cost you, including both your time and money. It okay to list the big stuff like pools and casitas, but keep in mind your overall financial picture. After you have made this list, schedule a meeting with a real estate professional to discuss your "must haves" and "dream" items. The professional can advise on the items you should tackle that will add considerable value to your home. You will find here that some items will add much more than others. You may be asking... what are these "better" improvements. Im glad you asked!

 

KITCHEN IS KING

As discussed in previous articles, you are actually selling your kitchen, not your home. You can have a very nice home with fresh paint, new tile flooring, covered back patio, and a pool. If you skip the costs of an updated kitchen, it will surely cost you dearly. I always suggest my clients to take a look in the kitchen before they start making upgrades elsewhere. How are the appliances? The lighting fixtures? Is there enough open space? Are the cabinets dated? And for god's sake, what kind of countertops do you have?!

You can DRAMATICALLY improve the value of your home just by putting your best in the kitchen. If you can't afford granite, marble, or quartz, buy corian or some other non-laminate countertop. Laminate can sink you have value by 10-20k in comparison to other homes in your immediate area with similar amenities. Can't afford all new appliances? Upgrade one or two. Potential buyers will look at the new appliances as though you have really taken the time, money, and effort into making your kitchen modern. Cabinets do not have to be replaces if they are dated. Add a fresh layer of paint or staining with new handles and knobs. Lastly, light fixtures. Make sure you brighten up the new space with a new lighting fixtures that accent all of your hard work.

 

BATHROOMS

Liven up the bathroom. Don't spend a ridiculous amount of money on granite vanities, high tech toilets, and advanced features in your showers. If you have fiberglass wainscoting, change that to tile. Solid plastic will due for vanities unless you want to go the extra mile. Tile floor or hardwood is a must for all bathroom spaces for optimal value.

 

Fireplaces

If you have a dated fireplace, I recommend refinishing the exterior with new brick or stone. You tend to always get your money back out of this simple improvement. It also gives the room around it new life.

 

Flooring

If you have already spent your budget before you get to this phase take these things into consideration. If you have old flat carpet, pay a professional to come out and clean it. It will fluff it back up and look updated. If you have old hardwood floors, consider sanding them down and refinishing. You will find that tile and hardwood will bring optimal value to your home. It Q1-3 homes (quality grade based on upgrades, these are high end homes), I generally find tile in most living areas including bathrooms, kitchens, living rooms, etc. In the same homes I typically find hardwood in the bedrooms and sometimes a mix in living areas such as dining rooms and family rooms. Just something helpful to keep in mind.

 

Lighting

If your purpose for upgrading is to sell then this is a must. Lighting up your home is important. Prospective buyers want to walk into your home and see how bright it is. Envision themselves in your home. Bright homes evoke emotions of joy, happiness, and comfort. Update old fixtures to brighten up your space. Replace old blinds, clean the windows. You get the idea.

 

Patios, Pools, Pergolas

The more patio space you have the better. This add real money to your home based on the patios total square footage. Whether its covered or uncovered, consider spending the extra money on the exterior by adding more patio space. Include a pergola. This further increases the value of the patio space and you will find you will get what you spent back in increased value.

Pools are a little more tricky. I do recommend you get a pool with your upgraded interior. While your at it, pebble tech is an extremely smart approach. However, with that being said, do not go all out on the pool and expect to receive that back in increased value. What I mean by all out is items like massive slides or an negative edge infinity pool. As these items look great, I can promise you will not get that money back. Get a pool, add a waterfall if you'd like, just do not go all out and spend 65-100k on a pool and expect that to increase your homes value by that given amount. Not going to happen.

 

Landscaping

This is the final thing on the list because it can be the outlier when valuing your home in comparison to other homes in your immediate area. If you take time to add some hard wood, grass, or artificial turf in the yard, you can bet you will receive added value. We are in the desert. Many homes just leave dirt and gravel in the back yard with must of the same in the front. If you take the time and improve the front and back yard spaces with nice green items, you can bet your home will stand out and will receive a bump in value.

 


 

My advice to you is to start in the kitchen and work your way down from there. Thank you for reading this post and remember to subscribe for more helpful advice! If you have any specific questions please email me at mattbeard@azexceptionalhomes.com and I will be more than happy to help! Follow us on Instagram and like our page on Facebook! Thanks again!

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