I recently met a friend who wants to sell his house and reinvest the proceeds elsewhere. But before doing so, he decided to make some major repairs, such as waterproofing and wall carpeting with the latest tiles, trimming the garden with Italian grass, remodeling the open kitchen, etc. In the process, he spent a huge amount of money, and now the quoted price of the house has obviously escalated.
I am sure no rational seller would like to spend such huge amounts on the house when it is decided to get sold. If at all, some repairs and refurbishments are needed, but they must be at a peripheral level to bring it back to life rather than spending the whole lot and expecting the buyers to pay for it.
These are some of the crucial lessons one must learn, especially in the region of Virginia and around where the prospective buyers flock in with the cash and are ready to occupy the house on an as is where is basis.
To begin with, the additional investment for improvements to an existing home should not exceed 1-2 per cent of its market value. If it gets exceeded, there is no guarantee that buyers will be interested in meeting that extra cost.
Secondly, only the essential parts of the home that need immediate repair should be undertaken rather than other cosmetic surgery to facelift the house in totality. Such extra things may or may not be liked by the prospective buyers, and if they want to remodel, then those costs go in vain.
Landscaping, swimming pool remodeling, furnishing with new lighting and upholstery, repairing solar panels, expensive garage makeover, renovating the kitchen stuff, upgrading the windows by replacing them with new frames, wall-to-wall carpeting or extravagant style specific tiling, creating shelf space with extra carpentry, remodeling the bedrooms with luxurious upkeeps, and so on, must be avoided unless they are demanded by the prospective buyer and with prior acceptance to undertake such costly activities.
Consider investing in home improvements that add value to both ends, rather than just being eye-catching and glitzy. Some people don’t actually bother whether they reap back their investments on such improvements and try to enjoy their stay with remodeled additions till they sell it finally. After all, it's their home, and they have every right to be enthusiastic about it and feel a sense of ownership.
Renovation projects always aim at twin benefits: facelifting the house and adding value to its sale price. Especially when the house owners intend to selling house anytime during retirement or nearing retirement or for the purpose of reinvesting in a place having high returns, then such a thought process must align with financial implications and outcomes.
Thus, it is advisable to ponder over the cost and benefits of makeover, redefining the house either partially or totally, on the lines of prospective returns out of the sale, and then proceed to execute such decisions.