Six home improvements to avoid prior to sale

Six home improvements to avoid prior to sale

When trying to decide whether or not to invest in a home improvement project prior to sale, the most important consideration is return-on-investment (ROI). Some projects will simply cost more to complete than they’ll pay you back in equity.

Here are six home improvement projects to avoid because they yield a poor ROI, and some might even turn off future buyers.

Remodeling a home office
If your home office is looking dated and making you unproductive, it’s important to make some updates to keep it functional and inspiring. But don’t go for a complete overhaul. It’s unlikely to pay-off, especially if you borrow usable space from a bedroom, living room, or garage. On average, home office remodels recoup only about 50 percent of the money you spend on them. Go ahead and add some nice portable elements that can move with you when you sell the house — like a modern steel desk, ergonomic chair and area lighting — but don’t knock down any walls.

Installing a pool
Unless you live in a state where pools are the norm, like Florida or Arizona, don’t expect to recoup the money — anywhere from $10,000 to $50,000 — that you’ll spend on installing a pool. Many buyers are turned off by the thought of having to maintain a pool: constant skimming, filtering, PH-balancing, heating, repairing, and winterizing. Typically, you’ll only recoup about 30 percent of your investment in a pool. That’s not a very strong ROI for an amenity you may only use a few months a year depending on your location.

Installing a new roof
If your roof is falling apart, of course it needs to be replaced. But cedar shakes and clay tiles, while instantly transforming your house, probably won’t greatly inflate your sales price. Buyers consider a roof a bare necessity, not a luxury item that will motivate them to pay more. A fancy new roof doesn’t really add value to your home if the old roof was working fine in the first place. Focus instead on making necessary repairs to keep your current roof in shape and up to code. Plus, you’ll only recoup an average of 60 percent of your investment, depending on the type of shingle you choose.

Adding a new bathroom
Adding a new bathroom to your home sounds great in theory, but doesn’t pay-off in reality. It costs a large sum of money to add a new bathroom when you take into account the electrical, plumbing, flooring, and structural changes. And that doesn’t even count the appliances and decor you’ll need to make it functional. You could spend anywhere between $20,000 and $40,000 to create a basic bathroom and upwards of $70,000 for a top-of-the-line addition. At most, you’re looking at recouping maybe 60 percent in resale value. That’s not a great return for the time and treasure you’ll spend, so you’re probably better off focusing on simple updates and cosmetic changes throughout the rest of the house.

Adding a sunroom
Much like a pool, a sunroom addition sounds appealing, but it’s not a major selling point for the majority of homebuyers in most parts of the country. Since a sunroom is an addition, it’s an expensive project — usually between $10,000 and $20,000 — and it’s only useful if you enjoy lots of sunlight or are willing to add air conditioning to the space to make it more functional. On average, homeowners will only recoup about 50 percent of their investment with a sunroom addition. But, that number can drop dramatically if you live in an area with very little sunlight or extensive winters.

Making over-the-top improvements
When it comes to home improvements with the best ROI, better isn’t always more valuable. While transforming your vintage kitchen into a modern workspace will likely increase your home’s value, installing a top-of-the-line Viking refrigerator and professional-grade Wolf stove probably won’t pay off. Before your minor upgrade turns into a major renovation, ask yourself whether potential buyers in your area are likely to value and pay for luxury improvements. To get the best return on your investment, check local listings to see what the standard is in your area and then meet that standard, but don’t vastly exceed it.

Do you know of any other home improvements that yield a poor return-on-investment? If so, please leave them in the comments section below or on Twitter or Facebook.

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