Renovation nation
Think ahead to determine what you want back from what you put in
Homeowners who intend to take on a home renovation project need to decide what they want to get out of it, and weigh their options if they plan to finance it.
Even with low interest rates on financing, not all renovations are good deals for homeowners looking to up the market value of their houses ahead of a sale.
Digging to put a swimming pool in the backyard, installing a heat pump, upping the insulation while re-siding exterior walls or getting more energy-efficient windows and doors are all things that probably make a house a lot more enjoyable and comfortable for the people who live there but tend to do little for resale value, say appraisers.
The same thing applies to beautiful cedar fences, elaborate landscaping, extensions to the house, including sunrooms and decks, and finished basements.
“It’s not going to be a dollar-fordollar thing,” said Tony Woolridge, owner of Appraisal Services in St. John’s, N.L. “You enjoy them, and they give you that value but in terms of the marketplace they may not have that return.”
Costly structural repairs to foundations, electrical wiring, plumbing and the roof, including the replacement of all the shingles, typically do not add much to a home’s resale value either.
However, keeping these things in good condition can prevent a house’s value from plummeting, so they still have to be done even if only to keep the resale value from falling.
The biggest bang for the renovation buck for homeowners looking to sell a property has traditionally been work done to modernize and spruce up kitchens and bathrooms, said Woolridge.
Think bathtubs, bathroom fixtures, toilets, and vanities and kitchen cabinets.
“If I’m walking into a 30-year-old home that has functional but dated cabinetry and I replace that, that’s going to be where I’m going to get my biggest return,” said Woolridge.
Even those renovations, though, have to be tempered by common sense since an extremely lavish kitchen and bathroom in an otherwise modest home can look, well, just out of place.
“You don’t want to over-improve,” said Woolridge. “You want to stay consistent with the values in the neighbourhood. You’re not going to put in a $40,000 kitchen in a $300,000 property.”
When renovating with an eye to resale value, it can also be a good idea to stick with styles that have broad market appeal and avoid the temptation to deck the place out with a funky new style or retro look just because it has been featured in a magazine.
“If you’re going to renovate your kitchen really retro, then that’s a pretty specialized renovation and you have to find someone who likes that,” said Woolridge.
His advice? Skip the fancy interior designers and just talk to people at the hardware store.
“You only have to go as far as your flooring supplier and paint store to find out what the latest materials are,” he said.
Whatever style and materials a homeowner chooses for a renovation, Woolridge also suggests they finish what they start since a halfbaked reno is almost never a good look for a house on the market.
“If you’re selling a house and the renovations are not complete, it raises all kinds of red flags,” he said. “You’ll lose – and better than dollar for dollar.”