Not All Home Improvements Lead to Higher Value

Homeowners looking to upgrade or sell their home this spring should realize that not all remodeling and renovation projects will yield a full return on their investment, the president of the Appraisal Institute said today.

“When it comes to home improvement projects, especially in today’s economy, not every renovation or remodeling effort will pay off when the owner sells their home,” said Appraisal Institute President Leslie Sellers, MAI, SRA. “Consumers need to be aware that cost does not necessarily equal value.”

For consumers looking to upgrade and possibly sell their houses this spring, Sellers has put together a quick list of advice that real estate appraisers often share with homeowners:

• Emphasize the essentials over the extras by investing in basic upgrades, such as fresh paint (use neutral colors) and new fixtures.
• Know that curb appeal is vital; exterior projects can sometimes provide a greater return on investment than interior projects.
• Avoid over-improvement by sticking to what’s proportional in your neighborhood.
• Consider adding a bathroom, bedroom or renovating the kitchen, which are appealing features for home buyers.
• Projects that add square footage to bring a house up to – but not significantly beyond – community norms typically yield good returns.

Sellers also recommends that homeowners who are serious about knowing their home’s value hire a professional real estate appraiser. Appraisers can help by providing honest, ethical valuation advice regarding which renovation projects will yield the greatest return on investment.

The appraisal institute has a handy online resource for locating an appraiser in your area.  You can access the site by clicking here.

The appraisal institute also has a brochure available that gives useful tips to help homeowners decide which remodeling or renovation projects will rturn the best value.  To download this free brochure click here.