Since COVID-19, our lives have been severely disrupted and there are plenty of difficult issues that many of us are dealing with. The summer real estate market saw a level of “bonkers” that hasn’t been seen in a while. We’ve seen low sales inventory and higher buyer demand, all while people are dealing with their fears of either giving or getting COVID-19. Many people decided that having buyers trounce through their homes right now, didn’t seem like a very good idea. While others took advantage of using virtual tours, appointments, and extra safety precautions when allowing strangers into their homes. Many of these homeowners have been reaping the benefits of record-low interest rates combined with lower inventory hoping that would equate to more money and quicker sales for their homes.
So why aren’t all of the homes selling quickly and for lots of money? There are many reasons that can make a home sit on the market for too long. I won’t get into all of those reasons here and now, but rather focus on one of them. The issue is that your home is outdated and will require work from a potential buyer that they may not want to spend the time, energy, or money on. New homes are in demand and new builders are your competition.
If you are a homeowner and not interested in opening your home up to strangers until you feel it’s safer, maybe now is a better time to get your home ready for when it is a better time to sell. Now is the time to ask, what does your home need?
To answer this question, let’s consider some numbers. Sellers should know that most remodeling efforts only increase home values by 50% – 80% of the average project’s costs, according to Remodeling magazine’s 2020 Cost vs. Value report. For example, the average cost of a mid-range bathroom remodel is $21,377. You’d recoup about $13,680 (64%) of that amount during a resale. However, the cost of inaction can be far greater than the small loss you’ll incur on any home-improvement projects. In fact, it may cause your house to linger on the market longer. As a result, you’ll likely have to pay the ongoing mortgage, maintenance, and staging costs, as well as lowering your asking price to get it sold.
If you want to get the most bang for your buck, focus on features that most home buyers really want to see. Consumer tastes can vary by region, so consult with your local real estate agent to find out which home features are in high demand in your area. Demographics are a good indicator of what you should do to make improvements.
#1 Laundry Room
- Percentage of buyers who want this feature: 91%
- Cost to install: $1,000 to $10,000 for a small-scale project
More than anything else, homeowners want a room other than the guest bedroom to stack all the clean laundry in until it finally gets put away. A separate laundry room tops the National Association of Home Builders’ (NAHB) list of most-wanted home features by buyers. Potential buyers will see it as a huge benefit.
If you don’t have an existing laundry room and want to add one, the basement is usually the easiest (and cheapest) place to put it. In fact, adding a laundry room in the basement can cost as little as $1,000. However, homeowners who prefer a laundry room or laundry closet (which fits just a washer and dryer) closer to the bedroom can expect installation to cost around $10,000 and an added sink and cabinets can run upwards around $15,000.
#2 Energy Efficient Appliances and Windows
- Percentage of buyers who want this feature: 89%
- Cost to install: Varies by appliance
Would-be buyers looking to limit utility bills will be drawn to properties with Energy Star-qualified windows and appliances. Gone are the days when these types of features were an anomaly. Today’s home buyers expect energy efficiencies.
Energy-efficient windows can trim heating and cooling costs by 12%, while individual appliances, such as an Energy Star-certified washing machine can save homeowners $45 a year or more on their utility bills. Replacing an existing clothes dryer with an energy-efficient version could save as much as $245 over the appliance’s lifetime.
Energy Star-qualified windows have an invisible glass coating, vacuum-sealed spaces filled with inert gas between panes, sturdier weather stripping than regular windows and improved framing materials — all of which reduce undesirable heat gain and loss in the home. An Energy Star-certified dishwasher uses soil sensors to assess how dirty your dishes are to minimize water use. Once installed, sellers should be sure to play up these money-saving features in their home listings.
#3 An Outdoor Space or Patio
- Percentage of buyers who want this feature: 87%
- Cost to install: $1,024 per 120 square feet for a concrete patio
It’s important for homeowners not to neglect the backyard area when prepping for resale. In today’s housing market, outdoor living spaces have become the most coveted outdoor home feature.
Nowadays, home buyers envision everything from an outdoor fire pit area with seating to a backyard wet bar.
#4 UPDATED Ceiling Fans
- Percentage of buyers who want this feature: 85%
- Cost to install: $473 per fixture with light kit and remote control
In addition to improving a home’s aesthetic, energy-efficient ceiling fans can also help lower cooling costs when used in conjunction with an air conditioner during the warmer months.
Adding or updating an old existing inexpensive design can go a long way in the overall way a potential buyer sees the value of the home.
#5 Storage Space In The Garage
- Percentage of buyers who want this feature: 85%
- Cost to install: $1,000-$4,000
Buyers with growing families need lots of storage space. Would-be sellers should keep in mind that organized living spaces equate to more dollars in their pocket at sale time. Carving out some space in your garage to help keep clutter out of the main level could help your bottom line. Do it yourself projects can be even more inexpensive. The goal here is to show a storage space that is highly organized to a potential buyer.
#6 Walk-In Pantry
- Percentage of buyers who want this feature: 83%
- Cost to install: Varies based on size and design
A walk-in pantry is the most-coveted kitchen feature among buyers polled in the NAHB’s report. Why? Homebuyers with families know that the kitchen can quickly become overcrowded when there’s not enough space to store the essentials (think: canned goods, condiments, and food storage containers).
Unlike reach-in closet pantries with sliding doors that offer limited space, walk-in versions allow homeowners to store larger quantities of non-perishable food items, other kitchen essentials and small appliances, just steps away from the food prep area.
#7 Hardwood Floors
While carpeting in the bedroom areas is usually okay, buyers these days expect hardwood floors in every other area throughout the home.
If carpet hides your home’s original hardwood floors, remove it, even if the wood isn’t in the best condition. Offer to have the hardwood refinished after you move out or give the buyer an allowance for refinishing. If you have carpet laid over plywood, consider installing hardwood.
Discuss with your real estate agent what is recommended – carpet replacement or new installation of hardwood or tile flooring.
- Cost to fix: The cost to refinish 500 square feet of hardwood flooring runs about $2,050 to $2,500, including labor, while the cost to install new hardwood runs from about $4,000 to $5,800. The cost to install 500 square feet of new carpet runs $2,156 to $2,986.
#8 Vanity Lighting
Nothing says the 1970s like a Hollywood-style strip of bare, round lights over your bathroom mirror. Replace it with a fixture that includes a shade for each bulb or a bath bar in a style and finish that complements your faucet set. Lighting is one of the most inexpensive ways to upgrade your home, plus its usually not a big job.
- Cost to fix: Many best-selling three-light fixtures with shades run $44 to $100. An upgraded wall sconce may run you a bit more. You should be able to handle this job yourself
#9 Minor Kitchen Remodel
A minor kitchen remodel averages $14,913 for $14,691 at resale, a recoup rate of 98.5 percent. Do a minor remodel when your kitchen needs a cosmetic update and not a drastically different floor plan.
A $15,000 kitchen update covers 30 feet of re-facing for cabinets and drawers, a new wall oven, cooktop, sink and fixtures, laminate countertops, and resilient flooring.
To maximize your return on the sale, if your home is worth more than $500,000, go with stone or trendy glass countertops. If it’s not valued over $500,000, you’ll want to talk with your real estate agent to see what’s the norm in the area. Depending on the age and remodels of the nearby homes, it might be necessary to add granite or another type of countertop material if what you have is laminate.
Brighten up the kitchen by sanding and painting existing cabinets. It’s much less expensive than buying new ones. You can also add decorator details without the cost by changing drapes and window moldings.
#10 Home Workout Areas & Home Offices
This is a newer request as the world of COVID-19 has made many people concerned about going to a gym with a bunch of other sweaty people. While you don’t need to concern yourself with providing the gym equipment for your new buyer, if you have the potential for showing off your current workout space in a neat, organized, and functional way, it could be a real selling point for someone who wants to set their own gym space up.
The Home office is another requirement for many people who are now working more remotely. If you currently have a space for an office, make sure it is highly functional and organized and it will help sell your space. Spending a little money on a “built-in” desk and shelves might be an option as well – if you have the right space for it.
Ask for advice
Whatever you decide to do, consult your REALTOR® about how you can get more “bang for your buck”. You want to make value for a potential buyer without over spending and losing money.