Why Renovation Pays...

If you are planning to sell your home, have you wondered what you should do to best get it sold?  And for the best price? 

First, you need to be sure to hire a Realtor then you want to think about what normal wear and tear has happened to your home while you have lived there. 

NATIONAL ASSOCIATION OF REALTORS® statistics show that home prices have fallen by an average of 7 percent nationally in the past year. But the value of home owners' investment in remodeling projects has declined only 3.86 percent on average between 2007 and 2008, according to Remodeling's 2008-2009 Cost vs. Value Report.

Have you been thinking about redoing the bathroom because there are some tiles are coming loose and the facet is the original from when the house was built? What about the kitchen?  Well there are several things you do on your home and this is why renovation pays;  you can recoup a good percentage of the price and it will help you get the best price for your home.

So why wouldn't you want to do a few little things around the house? 

Why Renovation Pays 

Why are renovations holding their value better than home prices today? "When housing slows down, people stay put and renovate their house to make it more livable," says Paul Zuch, president of Capital Improvements, a designing, building, and remodeling company in Dallas. And by renovating before they sell, home owners get to enjoy the new space themselves, not just make the home more appealing to buyers. "It just makes sense," says Zuch. 

Why Renovation Pays?

1. It makes the home buyer's lives easier:

"Home owners who remodel their home are providing a service to future buyers," says Eileen Nelis, a broker at Savvy and Co. in Charlotte, N.C. "When buyers purchase, they don't want to do all that painting and remodeling, and they don't want that price tag. They may be willing to make improvements down the line, but when they purchase, they want to open the door and have everything complete. It reduces their stress."  It makes the appeal of your home even better for the home buyer which shows why renovation pays.

Another reason Why Renovation Pays?

2. Reduces your,The Sellers, stress:

Making home improvements can also reduce sellers' stress by heading off that time-honored negotiating technique-pecking away at the sales price by pointing out imperfections found in a home inspection. "If sellers have done some improvements and dressed up their property, the improvements will help sell it," says Bernard Fallon, broker at Fallon Associates Realty in Rochester, N.Y. "If sellers don't want to improve their property, buyers will tick off the repairs and try to take them off the price." 

That doesn't mean that every home owner should do every renovation, even in a more stable real estate market. Take Tulsa, Okla., where median home prices actually edged up slightly more than 2 percent in 2008, according to NAR. REALTORS® in Tulsa reported that, of the 30 remodeling projects surveyed, only 16 netted home owners at least 80 percent of the cost. 

Remodeling produces the Cost vs. Value Report each year in cooperation with REALTOR® magazine. REALTORS® responding to a survey in midsummer said home owners could expect to recoup a national average of 67.3 percent of their investment in 30 different home improvement projects. At the height of the housing boom in 2005, home owners could expect to recoup a national average of 86.7 percent on projects.

So what are the best projects to tackle right away? As you can see on the chart, the best bets are:1. Upscale (fiber cement) Siding, or 2. Adding a deck to the yard, which have an 86.7% or 81.8% return respectively.  Even if you don't want to do those projects, none of the projects have less than a 50% return, which shows even more why renovation pays.

 Despite the value, the weak economy is likely to slow seller spending on remodeling, at least in the short term, predicts the most recent Leading Indicator of Remodeling Activity computed by the Joint Center for Housing Studies at Harvard University.  

Yet, despite declines in overall remodeling dollars spent and a still shaky housing market, "people's homes are still one of their best, most solid investments," notes Zuch. "Even though the markets have gone through some adjustments, it's still smart to invest in your home."