Seven point nine five.
That’s how many years the average American homeowner lives in their home, according to the number crunchers at Attom Data.
Whether you are at the beginning, middle or end of this nearly eight-year period, some day you will sell your home. While it’s great to renovate for your comfort and enjoyment, keep in mind that what you do to the home now may have an impact on both how long the home takes to sell and how much money you’ll walk away with.
In other words, investing $25,000 in remodeling will not necessarily mean you can tack on an extra $25,000 to the asking price when you sell the home.
Let’s take a look at some of the worst renovations you can make if you hope to get a payoff when you sell.
Installing wall-to-wall carpeting or hardwood flooring
Yes, there was a time when new wall-to-wall carpeting or hardwood flooring would boost a home’s value. Those days are long gone.
The fact that flooring-giant Armstrong sold off its hardwood line is a tip that Americans are officially out-of-love with hardwood floors. And carpet?
Lowe’s had such a hard time selling carpet that they decided to offer free installation. To no avail; they still saw a nearly 8% decrease in carpet sales.
Today, homebuyers prefer luxury vinyl and will discount a home’s perceived value if they will need to replace flooring after they move in.
Converting the garage
Garage conversions are far more popular in some areas than they are in others. They are especially popular in older neighborhoods with small homes.
Hey, who can blame someone for converting a garage into a bedroom when they need the space?
Just don’t expect that the conversion will translate into more money when the home is sold.
In fact, “If it’s not permitted, they’ll have a problem selling,” cautions George Holmes of Eagle Appraisal of Las Vegas. And, it if is permitted?
“It depends on the price class of the home,” Holmes said. “If it’s a cookie cutter home and it lacks a 2-car garage, we’ll deduct $8,000 to $10,000 from the value. It’s not cut and dry, however,” he cautions.
You can almost count on your home appraising for less than similar homes that have garages.
Permanent Conversion of a Bedroom
Bedrooms add value to a home. Often, however, homeowners permanently convert a third bedroom into an office, a gym or a family room.
While there is nothing inherently wrong with adding any of these conversions, if you can’t change the room back to a bedroom when you sell the home, the value of the home diminishes.
Since you now have only two bedrooms, the appraiser will compare your home to other two-bedroom homes.
Better Ways to Spend the Money
No matter how much you renovate or remodel a home, if deferred maintenance rears its ugly head, you will lose money on the sale of it.
Put your home renovation dollars toward the less sexy projects: new heating, plumbing and electrical upgrades and anything that boosts the home’s curb appeal.