Your Biggest Investment and How to Maximize Its Value

By
Services for Real Estate Pros with Montague Miller & CO

First, source the information about any subject carefully. Often, what you are reading is based on national data. In many markets, even regional trends are not specific enough. What you hear the most is "everything is local". But, how far down do you drill to reach useful information? It depends on where the property is located. Finding a knowledgeable professional who can give you access to statistics is a start. Local MLS information gives a great snapshot of properties in the general geographical area/municipality surrounding the property. The next level is data for recent & pending sales from either the subdivision or a specific distance around the subject property. Days on the market and concessions given by sellers (if any) can indicate what buyers want. Looking at photos of comparable sales, is a great way to see what features sold similar homes. This can support and suggest improvements or renovations that home owners can make.

Second, it is helpful to obtain the neighborhood statistics like ages of buyers, number of people in the household, distance from work and their professions. This gives an idea of who is buying in your immediate area. It can help a home owner decide what improvements and upgrades to make while they own the home. Reading the latest reports concerning the improvements/renovations with the highest ROI is a good reality check. Hot tubs are a simple example. Most owners who install a hot tub want its value included in the home's price. Many buyers do not care if there is a hot tub and half of them want it removed. So, if an owner puts in a hot tub, it is for themselves and not to necessarily increase the value of the home.

Third, the time that the improvement/renovation will be enjoyed by the owner is also an important consideration. After all, the assumption is that they do it for themselves. However, if they are doing it specifically for the resale value, it changes the financial considerations. In this case, input from a knowledgeable real estate professional can be invaluable before making a final decision. They know what buyers in a specific area and price range want and what features/bling make a difference. Well-meaning friends and relatives often push an elderly home owner to upgrade their kitchen. This is not "a no brainer" decision. There are a number of things to consider and sadly, owners spend valuable resources on buying something like stainless steel appliances. Often, the potential buyers would see more value in an appliance credit/allowance so they could choose the style and brand they want. What the elderly home owner decides to do should depend on what features/improvements help sell properties in their area. Their financial situation and how long they plan to remain in their home are also important considerations.

There is not a formula for improvement/renovation that always applies across geographical regions and socio-economic groups. What owners see on TV and read in popular magazines are broad generalities. Information on local market sales is the most important thing an owner can consider if they want to maximize their ROI. Although it is never a sure bet, the informed person definitely has the edge.

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