I made home improvements: Will I recoup my expenses when I sell?
You had just spent $40,000 on a kitchen makeover…when your company announced they were transferring you to Dallas. You bought your current home a year and a half ago for $250,000, so now you can put it on the market for $290,000, right? Not exactly.
Sure, you updated the kitchen, which is typically a good return on investment. But a similar house up the street just sold for $275,000 and it’s on a larger lot than yours. Plus, you bought in the late spring and it’s now early winter. Oh—and your teenaged daughter insisted on painting her room black.
Or, perhaps it’s more like this: Home prices in your neighborhood shot upward in recent months after the local public school got an A+ schools rating and a new upscale shopping center broke ground a mile away. That house around the corner just sold for $315,000, and it’s not even updated. Plus, you originally bought the house in the dead of winter, but now it’s late spring. Oh—and your spouse is a master gardener who has made the yard look amazing.
How to Set the Listing Price for Your Home
In the first scenario above, you’d be incredibly lucky to get $290,000 for your home; in the second, somewhere in the low $300s might not be an unreasonable price point. But as I hope you can see, the price you set for your house isn’t based on what you “need to get” based on paying off your mortgage, “getting back” the investment you made in updates, or even what you paid for it. There is an array of factors that a reputable real estate professional will assess before recommending a list price for your home. Here are the top six questions to ask yourself when considering what a reasonable list price is for your home:
- Does the home have curb appeal? Is it freshly painted and landscaped? Will it look “home-y” to someone who’s never seen it before?
- Does the home have up-to-date kitchens and baths? Most buyers aren’t interested in having to pay for updates if they can buy a home that’s already up to date.
- Have you maintained the house meticulously? Buyers want to be able to picture themselves moving in with no hassles or unexpected repairs.
- What improvements have you made to the house? Did any add usable square footage? Along with updates to kitchens and baths, adding usable space to a home is typically a value-adder.
- What have comparable homes in your neighborhood sold for within the last 3-6 months? This information tells you what the market for home sales is like. No matter what you want to sell your home for, the market conditions are one of the most important factors that go into what you’ll actually get for your home.
- What are the search categories on the online listing services you and your Realtor® will use to promote your home for sale? If the search category is $250,000-$299,999, and your asking price is $300,000, you’ll be missing out on a large portion of potential buyers. Why not price it at $295,000 or even $299,999 instead? (There’s also a psychological advantage to prices ending in 99, right?)
At The Vincent Group at GreatNest, we will help you determine the best listing price for your home for sale, and we’ll help you navigate and negotiate the offers you receive. Check out our other posts on pricing at "Price Your Home for Sale" and "Properly Pricing Your Home."
We are proud to save our clients money by charging a low set fee instead of a percentage commission, offering complete real estate services for buyers and sellers in Greensboro, High Point, Winston-Salem, Summerfield, Oak Ridge, Jamestown, and other Piedmont Triad areas. Please get in touch with our experienced real estate professionals by calling (336) 790-5210 or by emailing Steve Vincent. Visit our website at greatnest.com.