8/24/2010

Tips for Increasing Your Home's Value

It's not unusual for a Realtor to hear a property owner say that their home is worth a certain amount because of a particular recent sale price of another house in their neighborhood. Many times the Realtor has a different opinion about the home's value than the property owner does, not because it ultimately couldn't, but because of the way it looks right now.

It's like selling a car: A prospective buyer is far more attracted to a pretty, shiny, vacummed-out, cleaned-up, polished car sitting out on the curb when they first pull up to take a look. They are far more ready to have a discussion about it, since it compares favorably or more favorably than most other cars they looked at, and a buyer is more ready at that point to believe the car has been well-maintained, which means it's worth more to them because there will be fewer repairs.  And this is the same approach owners need to take with their houses and yards. You probably wouldn't consider getting maximum value out of your car without putting some effort into its presentation--and you need to do the same with your home:
  • Trim overgrown trees and bushes so that branches are at least 10 feet away from your roof -- and possibly include that same guideline for driveways, walkways, and outdoor sitting areas, or if vegetation visually obscures too much of your house so that it cannot be clearly seen from the street. Water your landscaping so that it looks green with no bare spots, and remove dead plants.
  • Consider having the house power-washed--it may eliminate a paint job (unless you have the next issue). This should be done only by a professional.
  • Touch up peeling paint. Not only is this an "attractiveness" issue, it signals negative messages about maintenance, and is also an FHA loan condition issue for an FHA buyer.
  • Have a professional inspect your roof and replace curled or missing shingles. Remaining life-expectancy is important, especially if most of the nearby roofs are much newer looking. Stains and plant matter such as moss can be removed with a cleaning. Considering that total roof replacement could be up to $20,000, a roof in poor condition could make your house appraise lower.
  • Routine maintenance and cleaning eliminates setting off alarms: repair gutters, obtain a pest/mold inspection report annually, replace missing bricks, repair exposed wood beams and window frames, remove or repair deteriorated gates and fencing.
  • Colorful plantings in the are a minimal investment, but will do much to show off your yard and your home.
It's important to remember that the money invested now will help you obtain a higher price from the buyer, and will help to eliminate value issues when the buyer's appraiser comes out to see your property during escrow. Many times sellers overestimate the amount required to prepare -- this amount will also depend on how much deferred maintenance you have and your budget. Spending $2000-$5000 dollars may bring you another $10,000-$15,000 in price, or at least help your house sell faster if your market is sluggish. Attempting to sell without any preparation could affect offering price, impact negotations during escrow if the buyer discovers further issues through their physical inspection and decides to walk away, and/or impact the appraisal. 

You can find more information on the Landscaping checklist and at the HouseLogic tab at the top of this blog.


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