Get Ready to Sell
Upgrades Increase Selling Price?
So how much should you spend to upgrade your home before selling it? Well, remember that the return on investment, or ROI, on home improvements is generally less than 100%.
Let’s say your home is worth approximately $200,000, and you spend $30,000 to remodel the kitchen. Many people mistakenly believe that the home is now worth $230,000. That’s dead wrong.
While a remodel certainly adds some value, it’s like buying a new car that depreciates in value the moment you drive it off the dealer’s lot.
So, while I recommend making small upgrades--like replacing the kitchen sink faucet or updating an old water heater--I don’t suggest doing any major remodels. If you have a sorely outdated kitchen or bathroom, you’ll generally come out ahead by discounting the asking price, so a buyer can choose their own finishes.
The vast majority of buyers make a purchase offer that’s contingent upon receiving a satisfactory report from a certified home inspector. Why? Well, most home lenders require it, and also may require additional inspections--such as a termite report--depending on where you live.