When you’re considering upgrades to your home, or you’re thinking about putting it on the market and want to make some “curb appeal” investments, one of the first things to consider is what kind of a return on investment (ROI) are you likely to see from this project. Some home upgrades can make the house more enjoyable while you’re living in it, while others can set you apart in a hot market. Before you invest a lot of time and money, crunch some numbers and make sure they add up. Local LA real estate expert Joyce Gottlieb can help you make informed decisions about which upgrades pay dividends and which ones don’t.
Improvements for Personal Enjoyment
Some things we do just for personal enjoyment. For example, a pricey swimming pool may add a little to your home’s value, but you may not get your full investment back when you sell. However, if it’s something you and your family will use and enjoy for years to come, it could be considered a worthwhile expenditure. There are also upgrades that are niceties that won’t break the bank but don’t significantly increase your home’s value either. Think French doors over a slider, built-in surround sound system, or under-cabinet lighting.
Improvements for Personal Gain
Some upgrades can have a serious return on investment. According to This Old House, upgraded flooring, a kitchen or bathroom remodel, the addition of a casita or guest house, or a finished basement are updates that can be nice to have while you occupy the home and can add to its value when it’s time to sell. How much you spend in the process should be based on your budget, anticipated ROI, and how long you plan to live in the home. Making pricey renovations for short-term personal enjoyment isn’t usually the best financial move.
Improvements to Sell
If you’re getting your home ready to sell and want to stand out from the competition, cosmetic fixes and some exterior “primping” can often do the trick on a small budget. For example, adding trendy or textured wallpaper from Spoonflower in the living room can make the space pop during showings, but it can be easily removed and repositioned elsewhere if the buyer wants to create a different look. Refreshing paint in secondary bedrooms and replacing flooring where necessary (or giving it a good deep clean) can give a house a clean look and feel while updating landscaping and making exterior repairs can give it good curb appeal. A few well-placed plants, uplighting, and power-washing will also work wonders.
Where to Use Caution
In addition to considering the financial and personal fulfillment value of various home upgrades, keep your neighbors in mind. You may have heard the saying: “You’re better off with the worst house in the best neighborhood.” This essentially means that if you and your neighbor have a similarly sized lot and the same house model, your home values will be about the same, to start. However, if you add $40,000 in super high-end carpet or marble floors, don’t expect the investment will add a $40,000 value to your home. If you and your neighbor both list your homes for sale on the same day and you have a significantly higher price tag, you’ll have difficulty recouping your full investment.
While you want your home to be comfortable and functional for your family, as well as retain or grow its value over time, think about your budget, needs, and short- and long-term plans before getting heavily invested in home improvements. Take care of a busted hot water heater or old air-conditioning unit? Yes! $100K in landscaping? Enjoy your palm trees, but don’t expect to see a big ROI.
If you’re interested in buying or selling real estate in the Santa Monica, CA area, Joyce Gottlieb is the expert of choice. Reach out for more information. (310) 283-8931
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