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Know your Neighborhood Before Investing in Home Improvement Projects

By
Real Estate Agent with Serving Sugar Land, Richmond, Rosenberg, Missouri City 620741

Homeowners invest in home improvement projects for many reasons. While personal taste and aesthetics matter, another crucial motivation is boosting the resale value of the property, particularly when contemplating a future sale.

Before diving into home improvement projects (especially if you are preparing to sell your home) it's crucial to understand your neighborhood's aesthetic and property values. Familiarize yourself with your neighborhood surroundings.

Here are some questions to ask yourselves:

What features are common in your neighborhood?

Are hardwood floors typical?

What amenities are considered popular?

When previewing homes for sale in my area, I occasionally find homes that have been "overimproved" for the neighborhood, leading homeowners to question why they did not realize a 100% return on their investment (ROI). Merely spending $100,000 on home improvements does not guarantee an equivalent increase in your home's value; the ROI varies across different interior and exterior projects.

Overestimating the value of your home based on improvements that may not align with neighborhood standards can lead to prolonged listing times (which may result in price reductions) and decreased interest from potential buyers.

Know your Neighborhood before Diving into Home Improvement Projects

Here are some key considerations:

Property Value Ranges: Every neighborhood has its own unique price range which are influenced by market trends. Investing in high-end improvements may not necessarily translate into a proportional increase in resale value if it goes beyond what the local market in your neighborhood can support. To maximize potential returns, align your upgrades with the typical price range of the neighborhood to ensure a better chance of realizing a favorable resale value. 

Consistency with neighborhood aesthetics: Different neighborhoods have varying standards and expectations when it comes to home features and quality. It's important to align your home improvements with neighborhood aesthetics by understanding local standards and market preferences. Overly extravagant or out-of-place improvements may deter potential buyers and reduce the resale value. Also, many neighborhoods are subject to Homeowners Associations. Check for HOA regulations, as certain exterior improvements may be restricted, ensuring compliance with neighborhood guidelines, especially in HOA-governed areas.

Local Zoning and Regulations: Make sure you know local zoning laws and building regulations. Certain improvements may require permits, and not complying with regulations could lead to legal issues and potential difficulties during the selling process. Always do your due diligence before starting a project. If you're not sure about things, contact the local building department or HOA.

Return on Investment (ROI): Knowing the typical ROI for home improvement projects in your area allows you to prioritize projects that offer the best returns. Focus on renovations that are in high demand and add value without over-improving relative to the neighborhood. Simple things like updating kitchen and bathroom hardware, replacing old lighting fixtures with brighter, more energy-efficient ones, painting rooms with neutral colors, or repainting or replacing the front door can add value to your home without you spending a ton of money.

Looking to upgrade your home? Check out my blog on home improvement projects that generate the best ROI. The information in my blog is based on the most recent Remodeling Impact Report, co-published by the National Association of Realtors (NAR) and the National Association of the Remodeling Industry (NARI).

Please reach out if you need any help with your real estate needs.

Posted by

Rosie Crow
Keller Williams Southwest
Cell: 281-703-6901
Email: rosiecrow78@gmail.com

Website: https://www.har.com/web/RosieCrow
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The finest compliment I can ever receive is a referral from my friends and clients! If you know of anyone who wants to buy, sell or lease a home, please let me know (or simply pass my info along)!

Michael Jacobs
Pasadena, CA
Pasadena And Southern California 818.516.4393

Hello Rosie - overimproving or inappropriate renovations can have all sorts of ramifications.  Unfortunately, they are often noticed too late.  Proper upfront preparation and understanding of the bigger picture can help.

Dec 17, 2023 05:21 AM
Joyce M. Marsh
Luxury Home Couture - Daytona Beach, FL
Joyce Marsh Homes & Design

Excellent advice for any homeowner who is thinking about remodeling or making improvements to their home or property.

Dec 17, 2023 05:55 AM
Rosie Crow

Thank you, Joyce. I thought this would be a great topic for a blog. It's important to ponder before any type of home improvement project. I hope you have a wonderful day! Happy holidays to you and your family.

Dec 17, 2023 06:33 PM
Joyce M. Marsh
Luxury Home Couture - Daytona Beach, FL
Joyce Marsh Homes & Design

Thank you and hope you have a very Merry Christmas and prosperous happy new year.

Dec 18, 2023 07:44 AM
John Pusa
Glendale, CA

Hello Rosie Crow very valuable report for know your neighborhood before investing in home improvement project.

Dec 21, 2023 08:41 PM