by TJ AndersonEach year, the Coldwell Banker Global Luxury program prepares “The Report,” a “comprehensive guide to high-end property buying and selling.” They dig deep into luxury home-sale
Home Renovations That Tend To Score Low On The ROI Scale
by TJ Anderson
As we get into winter every year, home listings tend to slow down a little, as families focus on the holidays and on hunkering down for the cold months. I find that also often coincides with homeowners spending time dreaming up restoration and renovation projects, or thinking about what they might want to do to prep their homes for listing when things thaw.
If you think you might list in the few months or years, there are simple things you can to to get your home ready to go on the market. Big renovations wouldn’t usually be among my suggestions there; for a lot of projects, the return won’t be huge, or immediate.
And honestly, there are some renovations that many experts think do more to detract than add.
It’s not that you shouldn’t take on those renovations — it’s just worth thinking about how long you’re planning to stay in your home before you do. If a renovation choice improves your day-to-day life, and you’re not planning on listing anytime soon, the way you weigh it out will be different. But if you’re wondering where your project sits on the “could this pay us back soon?” scale, here are a few projects that, according to lots of expert opinions (mine included), may not sit near the top of that scale.
Caveat: This is not meant to constitute financial advice, but food for thought as you explore your home renovation visions.
Turning two small bedrooms into one big room
Older homes have a ton of attractive qualities, but they also often have tiny bedrooms, with tiny closets. And more than a few people with older homes have thought, “I’ll just knock a wall down and turn my 3/1 with tiny bedrooms into a 2/1 with a big master,” expecting that choice to pay dividends. It might make you happier, which is an important consideration. But there’s value in distinct bedrooms, so you risk trading that value, and limiting your buyer pool.
Turning a bedroom into a semi-permanent non-bedroom
Different choice, same reason — you might prefer an office with elaborate built-ins or a man cave with a wet bar in that spare bedroom upstairs, but chances are, buyers will want a bedroom, and they’ll see your renovations not as added value, but a project they’ll need to tackle. Bedrooms are like black: Always bet on them.
Adding a swimming pool
If your vision of a forever-dream home has always had a pool in it and you have the cash to make it happen, no one should be popping a hole in that dream — you should have your backyard oasis. But if you do think you might sell your home even in the next five to 10 years or so, this addition’s subtractive attributes should at least cross your mind. Many buyers look at pool upkeep as an unwanted expense in both money and time, and families with young children often shy away for safety reasons. A pool could mean your property is a harder sell, and even barring that hiccup, good odds aren’t you won’t see a big return on that investment. All things to put on your pro/con list, before you take the plunge.
By now we’ve all probably seen enough home-improvement show episodes to know that laying carpet over wood floors earns grimaces from househunters. But what if your wood floors are in sorry shape? Or what if you’re finishing a garage into a flex room and need new flooring? Refinishing worn wood can be a more cost-effective option than carpet (numbers from HomeAdvisor: It usually ranges between $1.50 to $4 per square foot, depending on factors like conditions and location). And engineered hardwood can be a cost-effective option too, less expensive than sand-and-finish hardwoods, but offering a lot of the look. Hardwoods are among the 7 features homebuyers want the most, says Time, so if plans to sell are in your future, it’s a worthwhile consideration.
This isn't a big renovation, but it can be a big expense, depending on your fixture choices. Personally, I’m a big fan of statement lighting, and I think if you make a smart and stylish pick, a bold chandelier can totally make the space. But as with all bold design choices, there’s a risk, so I’d choose expensive, ornate lighting for pleasure, not investment. Even if buyers really like your taste in fixtures, chances are that pricey lighting won’t add direct value to your home. So do it because you love it, and if you’re selling soon, maybe wait until you get into the new place, so you can enjoy that fixture for a long time.
Another one that I tend to like personally, but that can bite you with buyers if you stray too far toward the taste-specific zone. Replacing flooring is a fairly big job, so if you’re gonna go wild/weird/unusual, just be aware of the risk. What you see as a cool, stylish tile trend, many buyers can see as a big line item on a to-do list, and that usually reflects in the dollar number on your offer, or a longer stretch of time to get an offer.
If you’re unsure about how projects you’re taking on might affect your resale value, it’s always worth talking to an experienced, licensed Realtor — we get feedback on buyers’ wants in our area day in, day out, so we have an informed sense that we can pass along. As you get your selling/buying/renovating thoughts together, I’m always glad to help. Just reach out and tell me about your plans.
TJ Anderson is a Nashville Realtor with Benchmark Realty who's helped countless clients both buy a home and sell a home in Nashville, Tennessee. He blogs about Nashville regularly, from Nashville-area....
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