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Aug 29
2012

Remodeling to Sell?


Posted by C. Mason Hearn in value, resale value, renovation, remodeling, bathrooms
I want to sell my house. All the rooms but one bathroom are renovated. Problem is, my house is only worth so much and renovating the bathroom will not make me any more money on it. Just make it sell easier. My wife wants to change the sink and toilet and leave the old green tub. I say leave it all and just clean it up; new floor and some tiles on the wall . What do you think we should do?                         Michael

 

Michael:

 While I can’t make your decision for you, one of the things that remodeling professionals regularly do, is help resolve differing perspectives between spouses.  Problem solver?  Maybe.  Marriage counselor?  You don’t want that from me!

 The return-on-investment of most major remodeling projects is twofold:  1) Resale value and 2) Value of use & enjoyment.  If you are remodeling with the intent of immediate sale, the latter appears largely out of the equation, and you’re simply focusing on “bang for the buck” at resale.

 What you need is both a remodeling contractor’s cost input for various approaches, and a real estate professional’s resale valuation of the same.  Fortunately, there is a resource for that.  Take a look at Remodeling Magazine’s annual Cost Versus Value Report:  http://www.remodeling.hw.net/2010/costvsvalue/national.aspx

 Generally, you are going to find that facelifts and more modest projects have a better return on resale value as a percentage, than higher-end projects.

 Consider the national average for a complete but modest, medium range bath renovation at $16,634, which is expected to return 64.1% at resale.  If you were going to live in the house for ten more years, $10,337 of that investment would be like investing in a CD that you would expect to be returned upon resale.  The remainder is about $44 a month – typically well worth it for a newer, accommodating bathroom.

 Otherwise, you might ask yourself if $5,300 is worth expediting the sale.  Certainly, a fully-updated home would be far more attractive to a broader range of buyers than one with outdated spaces.

 I wish you the best in whatever approach you mutually decide upon!

 Mason






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