Real estate experts say now may be a better time than ever to invest in a home improvement or home remodel project to help boost your home value.
According to Remodeling magazine, at the height of the real estate bubble, homeowners could expect to recoup 87 percent of their home improvement costs when selling, while the magazine estimates that a homeowner can currently only recoup 60 percent of their investment. Still, a good time for a home remodel is now.
A home equity line of credit is an excellent start to a home remodel, thanks to historically low interest on mortgage rates. For qualified homeowners, who would not be jeopardizing their savings or equity, it makes sense to invest in their home, especially if they plan on living there five years or longer.
The construction industry is still rebounding, despite some improvement from last year so as a result, home improvement contractors have discounted their rates, saving homeowners money. As an added bonus, the costs of materials like plywood, lumber and drywall has also come down.
A good first home improvement might be installing energy-saving appliances, as well as windows and insulation. The savings on your energy bill won’t entirely pay for the home improvement, but it will save you some cash year after year.
It might also be a good time to update your home and bring it up to date with other homes in the area. If you’re planning on staying in your home, a home remodel or small home improvement project will help you enjoy it all the more. Home remodeling experts say, while this is not the time to remodel just because you’re not necessarily thrilled with your kitchen, it is a perfect time to remodel an outmoded 1960s or 70s kitchen or bathroom.
Again, with mortgage rates bound to eventually go up, for qualified homeowners, it makes sense to refinance their homes now, or take out a home equity line of credit, and invest in the future.
Selling your home this spring? Here are a few tips to improve your chances of a sale.
HomeGain.com recently surveyed nearly 1,000 real estate agents, asking them to identify the top 12 do-it-yourself home improvements that can help sell a home faster. Cleaning and de-cluttering ranked as highest return on investment, no doubt in part because it was the least expensive. Its cousin, home staging, which largely involves removing unneeded furniture and other decorations, came in second.
According to the HomeGain survey, the top five home improvements that Realtors recommend to home sellers based on cost and return on investment (from highest to lowest ROI) are:
- 1. Cleaning and de-cluttering ($200 cost / $1,700 price increase / 872% ROI)
- Home staging ($300 cost / $1,780 price increase / 586% ROI)
- Lightening and brightening ($230 cost / $1,300 price increase / 572% ROI)
- Landscaping ($320 cost / $1,500 price increase / 473% ROI)
- Repairing plumbing ($385 cost / $1,250 price increase / 327% ROI)
Cleaning and de-cluttering continues to rank as the top suggested home improvement (since the survey was originally conducted in 2000), recommended by 98 percent of Realtors, costing less than $200 and returning a value of nearly $1,700 to the home’s sale price, or an 872% return on investment.
Rounding out the top 12, the list of low cost, do-it-yourself home improvements includes: updating electrical, replacing or shampooing carpets, painting interior walls, repairing damaged floors, updating kitchen, painting outside of home, and updating bathrooms.
The home improvement projects with the highest price increases to a home’s resale value is Updating the Kitchen ($1,200 cost / $2,850 price increase), followed by Painting the Outside of the Home ($900 cost / $1,815 price increase) and Home Staging ($300 cost / $1,780 price increase). Most of these projects involve the interior of the home.
It is important to recognize that these steps alone will not sell a home. Talk to us, we can offer more suggestions and tips.