What won’t add value to your home when you sell

Every homeowner must pay for routine home maintenance, such as
replacing worn-out plumbing components or staining the deck, but some choose to
make improvements with the intention of increasing the home’s value. Certain projects,
such as adding a well thought-out family room – or other functional space – can
be a wise investment, as they do add to the value of the home. Other projects,
however, allow little opportunity to recover the costs when it’s time to sell.

Even though the current homeowner
may greatly appreciate the improvement, a buyer could be unimpressed and
unwilling to factor the upgrade into the purchase price. Homeowners, therefore,
need to be careful with how they choose to spend their money if they are
expecting the investment to pay off. Here are five things you think add value
to your home, but really don’t.

 

1. Swimming Pools

Swimming pools are one of those
things that may be nice to enjoy at your friend’s or neighbour’s house, but
that can be a hassle to have at your own home. Many potential homebuyers view
swimming pools as dangerous and expensive to maintain . Families with young children
in particular may turn down an otherwise perfect house because of the pool (and
the fear of a child going in the pool unsupervised).

 

2. Overbuilding for the Neighbourhood

Homeowners may, in an attempt to
increase the value of a home, make improvements to the property that
unintentionally make the home fall outside of the norm for the neighbourhood. While
a large, expensive remodel, such as adding a second story with two bedrooms and
a full bath, might make the home more appealing, it will not add significantly
to the resale value if the house is in the midst of a neighbourhood of small,
one-story homes.

In general, homebuyers do not want
to pay $250,000 for a house that sits in a neighbourhood with an average sales
price of $150,000; the house will seem overpriced even if it is more desirable
than the surrounding properties. The buyer will instead look to spend the
$250,000 in a $250,000 neighbourhood. The house might be beautiful, but any
money spent on overbuilding might be difficult to recover unless the other
homes in the neighbourhood follow suit.

 

3. Extensive Landscaping

Homebuyers may appreciate
well-maintained or mature landscaping, but don’t expect the home’s value to
increase because of it. A beautiful yard may encourage potential buyers to take
a closer look at the property, but will probably not add to the selling price.
If a buyer is unable or unwilling to put in the effort to maintain a garden, it
will quickly become an eyesore, or the new homeowner might need to pay a
qualified gardener to take charge. Either way, many buyers view elaborate
landscaping as a burden (even though it might be attractive) and, as a result,
are not likely to consider it when placing value on the home.

 

4. High-End Upgrades

Putting stainless steel appliances
in your kitchen or imported tiles in your entryway may do little to increase
the value of your home if the bathrooms are still vinyl-floored and the shag
carpeting in the bedrooms is leftover from the ‘60s. Upgrades should be
consistent to maintain a similar style and quality throughout the home. A home
that has a beautifully remodelled and modern kitchen can be viewed as a work in
project if the bathrooms remain functionally obsolete. The remodel, therefore,
might not fetch as high a return as if the rest of the home were brought up to
the same level. High-quality upgrades generally increase the value of high-end
homes, but not necessarily mid-range houses where the upgrade may be inconsistent
with the rest of the home.

In addition, specific high-end
features such as media rooms with specialized audio, visual or gaming equipment
may be appealing to a few prospective buyers, but many potential homebuyers
would not consider paying more for the home simply because of this additional
feature. Chances are that the room would be re-tasked to a more generic living
space.

 

5. Invisible Improvements

Invisible improvements are those
costly projects that you know make your house a better place to live in, but
that nobody else would notice – or likely care about. A new plumbing system or
air conditioning might be necessary, but don’t expect it to recover these costs
when it comes time to sell. Many homebuyers simply expect these systems to be
in good working order and will not pay extra just because you recently
installed a new one. It may be better to think of these improvements in terms
of regular maintenance, and not an investment in your home’s value.

 

The Bottom Line

It is difficult to imagine spending
thousands of dollars on a home-improvement project that will not be reflected
in the home’s value when it comes time to sell. There is no simple equation for
determining which projects will garner the highest return, or the most bang for
your buck. Some of this depends on the local market and even the age and style
of the house. Homeowners frequently must choose between an improvement that
they would really love to have (the in-ground swimming pool) and one that would
prove to be a better investment. A bit of research, or the advice of a
qualified real estate professional, can help homeowners avoid costly projects
that don’t really add value to a home.

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