6 renovations that could destroy your home’s resale value

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While few homeowners recoup the full cost of home, renovations, updated bathrooms and kitchens, plus other improvements, can help you sell your home more quickly, and for more money. The added bonus is if you do the renovations while you live in the home, you get to enjoy the renovated spaces for at least a little while before it goes on the market.

This is an American article but the basic principles still hold true for Canada.

But some renovations can actually damage your home’s value. These supposed improvements
not only add nothing to your bottom line, they may make your home less attractive to potential buyers and bring down its value.

How much they hurt will depend. If the home is in a highly desirable location, potential buyers may be willing to overlook purple walls and an ugly kitchen counter, or they may be willing to do their own renovations. In a subdivision where many similar homes are for sale, the one with bad renovations may linger unsold.

In general, real estate agents and design experts advise keeping resale in mind when you renovate, especially if you don’t plan to stay in the home forever.

“Renovations are always best done when they’re neutral and tasteful,” says Gea Elika, principal broker of Elika Real Estate in New York and a regional director of the National Association of Exclusive Buyer Agents. “Don’t personalize it if you plan on selling it.”

According to Remodeling magazine’s 2015 Cost vs. Value report, the home renovations that bring the greatest return when you sell are a new entry door (which brings you 101.8 percent of what you spend on the national average), the application of manufactured stone veneer (92.2 percent) and a garage door replacement (88.4 percent). The ones with the smallest return are a sunroom addition (48.5 percent), a home office remodel (48.7 percent) and a bathroom
addition (57.8 percent).

The value of some features varies by geography. A swimming pool, for example, is more desirable in Florida or Hawaii than in Minnesota or Maine, but even in Florida some buyers might not want the added maintenance cost.

In Pittsburgh, where flat yards are rare, a home with a fabulous flat yard may sell quickly no matter what has been done to the interior. “You could get away with doing certain things to a house here that you couldn’t in Florida,” says Kevin Brown Jr., president of Praedium Real Estate Services in Pittsburgh and a regional director of NAEBA.

Here are six renovations that may hurt your home’s selling price or keep it on the market longer than it would be otherwise.

Converted garage. Some homeowners see converting a garage as a cheaper way to add more living space than building an addition – and it is. But many buyers would prefer a garage, especially in cold and rainy climates. “That room will always feel like a cold garage,” says Sabrina Booth, an agent with Redfin in Seattle. “A garage is much more valuable than an extra room in
Seattle.”

Eliminating a bedroom or powder room. In older homes, combining smaller rooms in the
public living space might add to the value because today’s homeowners like large, open spaces. Eliminating a powder room, however, is a bad idea. And turning a bedroom into a master closet or combining two bedrooms to create a large master suite may not pay. “You’ve eliminated a whole living space,” Brown says.

Heavy personalization. We all want to make our homes into our signature spaces. But some unusual features may turn off potential buyers. Matt Francis, branch manager of Better Homes and Gardens Mason-McDuffie Real Estate in the San Francisco Bay Area, once showed a $1.5
million home with a custom kitchen that had two college dorm refrigerators instead of a full-size fridge and no freezer. “Anything that is too personal or too specific would not appeal to the broadest pool of buyers,” Booth says.

Too much color. If you love color, paint the walls of your home all the hues of a rainbow – and then paint over them in a neutral color when you’re ready to sell the place. Be aware that aqua
appliances or neon tile may not appeal to most buyers. “Everybody has an opinion about a color. Nobody has a strong objection to neutral color,” Booth says. “Even though they can paint over it, their impression of the house is negative.”

Adding a pool. In some neighborhoods in warm states such as Florida, Hawaii, Arizona and California, pools are expected, and adding a pool to homes in those neighborhoods is unlikely to
scare off buyers. In cooler climates, where pools have to be opened and closed every season, a pool may be seen as more of an expensive hassle than an asset.

Renovations without permits. Nearly every municipality requires permits for major (and sometimes minor) renovations. That’s partly to ensure that all home improvements are up to code. Savvy buyers will ask whether renovations were done with permits (requesting
copies of them is a good idea), and some cities require inspections before homes are sold. Buying a home with unpermitted work can cost later if the city requires the work to be torn out and redone or levies a fine.

By Teresa Mears

Source money.usnews.com

 

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