Home Improvement Projects Can Increase The Value Of Your Home
by Emerson Lockwood
Home improvement projects can improve the look and value of your
home dramatically. Though in some cases, using a home improvement
project as a way to increase the value of your home can actually
backfire and cost you money. So how will you be able to tell if
the project that you have planned will add to the value of your
home or decrease the value of your home?
The first thing that you need to know is the appraised value of
your home. You must know the appraisal value, or estimated resale
price, of your home before you can determine if a project will
increase or decrease the value of your home. Although you may
feel that your home is worth a certain amount of money, and that
a home improvement will increase the value by X amount of
dollars, your feelings will not set the final selling price, the
appraisal will.
When completing a home improvement project that you believe will
dramatically improve the resale value of your home, you need to
consider your neighbors houses. If you have the nicest house in
your neighborhood, but you are trying to sell it for twice as
much as the appraisal value of other homes in the neighborhood,
you will be disappointed.
A general guide is to not try to sell your home for more than 20%
of what the surrounding homes will sell for. For simplicity, let
us assume that the homes in your neighborhood are appraised at a
value of $100,000. This would mean that you could expect to get
about $120,000 out of your home if you make selective home
improvements.
What this means for you as a homeowner is that you should
seriously rethink any home improvement project that would cost
more than $20,000 going by our above example. Using the above
example, it is easy to see that a $30,000 home improvement
project would cause you to lose money in the long run.
Now, if you can make a home improvement that costs very little,
but results in a higher resale value, it may be a good idea to
pursue that project. Going back to our example, if you can spend
$5,000 on a project and this results in your home being appraised
at $115,000, then it is a great investment idea.
You also want to consider the appeal that your home improvement
project would have to a future owner. For example, swimming pools
and hot tubs may be something that you enjoy, but would a
potential buyer pay extra for those features? There are some
fairly safe projects that you can pursue that other home buyers
generally find valuable. Some of these include kitchen
remodeling, adding or remodeling a bathroom, adding a new room,
landscaping, etc.
Also keep in mind that maintenance projects do not usually result
in an increased value for your home. Replacing a broken furnace
or hot water heater usually will not improve the value of your
home when selling it. These are considered maintenance issues
that all homeowners expect the home to have working. Most people
would not consider paying full price for a home that does not
have these basic features in working order.
The bottom line is that if you are interested in increasing the
resale value of your home you need to make smart decisions. Smart
decisions on which home improvement projects to tackle can put
extra money in your pocket when you sell your house.
Emerson Lockwood write on topics related to Home Technology,
Home Improvement and Home Financing. You can see more of his work
at the Super Home Ideas website:
http://www.SuperHomeIdeas.com .
Super Home Ideas covers everything to do with your home: Home
Improvement, Home Repair, Buying and Selling a House, Financing
a Home, Buying Homeowners Insurance, Gardening and Landscaping.