ROI

Ask Eli: ROI On Pre-Listing Home Improvements

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Arlington resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: We are planning to put our townhouse on the market this spring and wondering if you have any advice on how we should choose what improvements we should or should not make prior to listing.

Answer: The decisions you make on what money you do or do not spend improving your home prior to a sale often influence your bottom line more than any other decision you make during the sale process. They’re also the decisions you’re most in control of, so take your time and take them seriously.

Remodeling.com publishes an annual report showing the resale return of specific remodeling jobs, based on region of the country. Unfortunately, I can’t share the D.C. area report here because of copyright issues, but it’s worth going to the link (you have to provide them some basic info) to take a look yourself. The findings of their report show that the majority of projects, done individually, return just 50-80% of the cost. I have seen another study by Zillow that shows similar projections.

Note that I said when “done individually” most projects return well below 100% of the money spent, but when you combine the right improvements you can create value/profit that can add to your bottom line.

Tier Your Improvements

After you prepare a full list of potential improvements, it’s important to bucket them into tiers and analyze each tier for cost, project timeline and impact on the expected resale value to determine which improvements make the most sense. At a high level, these tiers generally fall into three categories:

  • Clean-out, Clean-up: This focuses on the low cost, high return items
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5 Ways to Forfeit the ROI On Your Home Remodeling Projects

There’s a lot that can go wrong with the remodeling of the interior and exterior of your home. This is why it’s highly recommended that you work together with an outdoor remodeling contractor that is reputable and experienced. The purpose of most home renovation projects is to increase the property value. Of course, the homeowner gets to enjoy the perks while remaining in the property, but ultimately, they will enjoy a larger sale price whenever they decide to put it on the market.

Unfortunately, not all home remodeling projects will yield a sizable ROI. In fact, some may even decrease the value of your property. In order to avoid this, we put together a list of the top ways you can lose the ROI on a remodeling project.

You Decided to Do it Yourself

The problem with do-it-yourselfers is that they typically aren’t professionals in new home construction or remodeling. This means they lack the skill set needed to properly install cabinets, flooring and other types of furniture. Then there’s the issue with measuring – this is very important for making a project look professionally done. If you’re not great with measurements, then you may end up with a crooked countertop and cabinetry. In most cases, it’s always better to hire experts to handle your renovations.

Making it All About the Appearance

If your top priority is to make something look nice, then chances are you’ll end up with mediocre results. A lot of the materials on the market may look nice, but the actual quality is subpar. This is a mistake a lot of cheap landlords make when trying to give their properties a newly decorated look. However, once the tenant moves in, they have issues with warping, tears and other flaws related to poor quality materials. Make sure …

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Top Home Remodeling Projects for a High ROI

If you are looking to add value to your home, be it to make it more perfect your needs or because you have plans to sell it, then you don’t want to invest money in a home remodeling project that has a low return on investment. However, determining what remodeling projects will bring the biggest bang for your buck might be a challenge – especially if you have a limited budget!

In recent years, there has been a resurgence of homeowners looking for ways to give their home’s a new look – but not every upgrade has an ROI worth talking about. Here are some of the top home remodeling projects for garnering a high ROI.

· Landscaping – While not actually a home remodeling project of the building type, research has shown that yards where the lawn is well-maintained and logically laid out can make a huge difference in the curb appeal of your home and thus, how much you can boost your home’s equity.

· New Roof – Want to get as much as a 105% ROI on a home remodeling project? Then talk to your local roofer about upgrading your home’s roof. While a new roof may not be the sexiest home remodeling project, it is one with a high return!

· Hardwood Floors – These too bring a huge ROI – in fact it is nearly a 100% ROI – perhaps more should you decide to do the work yourself, or happen to discover that underneath those tired carpets you have gorgeous hardwoods just waiting to be refinished.

· Patio or Deck – Boost your living and entertaining space while increasing your home’s value. Choose building materials known for longevity and get more value for your investment.

· Doors – From upgrading the front door to …

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