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