Perhaps you have seen the HGTV show “Love it or List It”. In that show, the two hosts (a realtor and a designer) work with frustrated homeowners who are struggling with how to best use their current space. The designer works with the homeowners to set a budget for renovations to get them to stay in the house, and meanwhile the realtor embarks on a home search with them to find something that better suits their needs. In the end, the homeowners decide if they will stay in their newly renovated house or purchase something new.
This is a common scenario –as our lifestyles, jobs, and families change over time, our homes eventually and often do not fit our needs as they used to. The question of “Renovate or List” seems to be on many people’s minds as of lately, too, due to all the changes that COVID has brought to our home lives.
An overarching rule for all of this is to consider the location. Is your home currently in your dream location, walkable to everywhere you want to be – or perhaps on acres of private land with no one around? If the location is everything you could ever want, well that is the one thing that cannot be changed. If you are already in your forever location, then certainly it is advantageous to make thoughtful renovations to your home.
We are in a low inventory market. This hasn’t changed for years, and in fact, it hasn’t been getting any better over time. There is a significant share of homeowners that have stayed put over the past several years which has contributed to home price escalation due to the laws of supply and demand. The price escalation in the offers that we are seeing also often comes with incredible offer terms such as flexible timelines for closing, inspection allowances, and more. Home buyers are ready, pre-approved, and extremely desperate to find something – willing to write a premium offer to just get something, anything.
What this means for you as a current homeowner is that it is a fantastic time to cash in. If you aren’t in your forever spot, you could put in $10,000 or $20,000 or $50,000+ into your house in renovations, and then you still might not be content. Buyers will pay a premium for your home regardless of the updates you have done, in most cases, and then you can use that extra amount of cash + the rapid equity gains from the past several years to truly plan out your forever home.
In the market of today with low supply and high demand, renovations will not automatically correlate with giving you a better return on the sale of your house. Especially significant renovations that are to your taste and that may not suit a buyer’s needs in the future. The best renovations to get a return are minimal – things like paint, light fixtures, and landscaping. These are the updates that allow a buyer to walk-in and say “wow, this home has been meticulously cared for, I can’t wait to turn it into my own”! With a low inventory market, you don’t have to have the most updated home on the block to get a premium price and return– you just must have the home presented well (de-cluttered, staged, deep cleaned) & marketed strategically with an expert real estate team that can ensure maximum exposure.
Posted by Alison Crim on
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