Interesting Tool for remodeling upgrades and values.
I ran across this tool via Zillow.com and so far am impressed. We have a very nice listing with great clients, wonderful feedback but no offers. See here. According to Zillow we are priced a little high, but the comps they are using haven't been updated and our listing has. It has new kitchen, baths, carpet & paint inside along with the roof and landscaping are all new or were done within the past couple of years. The location is good, but perhaps a bit off the beaten path. 8 months ago, another home on the same street sold, without any upgrades for $25,000 less than our current list price, and we are so much nicer.
I took a look at Zillow to see how the listing looked on their website and noticed the Zestimate was $15,000 below our list price. They have a button that says, "My Estimate", "Create." With this button I am able to add in the value of a new kitchen and baths. But wait, there's more. There is a site attached called, Remodeling . This site breaks the country down into regions, and then based on whatever fancy math they have; there is a list of various updates, like kitchen high end, kitchen moderate, with sample remodel costs and then a percentage return. For example, a major kitchen remodel in a midrange home is estimated to cost $62,997. They estimate the return on this upgrade would be $55,025 or 87.2%.
Zillow allows me to plug in the amount my client paid for their work, and then applies the percentage to adjust the value of the home.
What I appreciate is that the added value seems realistic, and not pie in the sky. In my area, according to this site most upgrades would not have 100% return on the cost. I'm certain they are assuming a full retail expense. By careful shopping and doing some of the work on your own, I'm certain costs can be lower and returns higher, but I like what seems like a safe tool.
What do you think about it?
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