A home is a serious investment, and in the lovely metropolis of Columbus, Ohio, it is even more so. Like any investment, a home needs to be cared for in order for its value (equity as well as appreciation) to increase, but that care gets prioritized along with other goals and plans. You may find yourself getting ready to sell and realizing that you never actually replaced the shag carpeting in the den or switched out those 1950’s bathroom tiles. Other things came up along the way, and the question becomes whether or not something needs to be done now. Should you remodel, renovate, or repair?
Repair, Renovate, and Remodel: What’s the difference?
Remodel means to completely change the form of something (think adding a back deck or completely redoing your kitchen), while renovating means to bring something old up to modern standards. For example, in your 1850’s farmhouse you decide to take the creak out of that old wood floor and give it a good polish. Repair means to fix something like a dripping faucet.
As you ponder selling your home and that shag carpeting, it may be tempting to aim for remodel. However, that may not be the best choice. What many people don’t realize is that a new kitchen or back deck will be stunning when it is finished, but it may not be worth the time, energy, and money required unless you plan to enjoy them for a few years.
Sellers should take a look instead at other, admittedly, less sexy things that buyers appreciate even more.
Small to Medium Changes Equal Bigger ROI
According to Remodeling magazines 2019 Cost vs. Value Report, an annual report the magazine puts together comparing what homeowners pay for 22 of the most common upgrades with how much they get back when they sell in 136 markets nationwide, the three best projects with the highest return on investment (ROI) are a fiberglass grand entrance, a composite deck addition, and a bathroom remodel. (The magazine polls contractors on how much they charge along with real estate agents on how much they think these upgrades increase market price. Each project’s cost is divided by the home’s resale value, resulting in a good idea of how return to expect.)
Each of these brought homeowners in the Columbus, Ohio region an ROI of 69.8-percent, 67.7-percent, and 57.5-percent, respectively. Glamourous? Not entirely. Valuable? You bet.
The North Central Region is veering somewhat from national trends, where a new garage door came in with top ratings for return on investment. However, the numbers here are also in keeping in other ways. A grand entrance improves curb appeal, while a back deck and bathroom remodel are upgrades that homebuyers, including first-time buyers, seem willing to pay a bit more for from the beginning.
These numbers also tell us that ROI is grounded somewhat in curb appeal like stone veneer and nice looking doors, but that energy efficiency is also increasing in appeal. Buyers, especially first time Millenial buyers, like something that looks good but is also green. Studies by both Nielsen and Deloitte show that this generation is willing to pay more for sustainability and eco-friendly goods. Green updates, then, are worth serious consideration on a few different levels.
It is also worth pointing out that as homeowners ponder whether to repair, renovate, or remodel, that they talk with a professional remodeler to see what they advise. As Remodeling magazine points in their overview of key trends for the year, trade tariffs and market uncertainty about the cost of materials and their availability play a role. It is one major reason things like the garage door, historically an easy upgrade with high ROI, fell off the list. A contractor or design professional can help you monitor the cost of a project and try to balance out the changes.
By no means am I discouraging homeowners from getting that kitchen of their dreams or finally expanding the upstairs bathroom to accommodate a growing family. If you plan to live in your home for an extended period of time, then do it and enjoy it. However, if the motivation to make these upgrades is simply to raise your selling price, it might be best to give it a little more thought.
In the end, though, it all comes down to how long you plan to remain in your home. If you think you have more than five to ten years left at that address, then start thinking about which wall to knock down. Make the changes that will make you happy and don’t worry about future buyers much. Housing fads (shag carpeting, marble countertops even) come and go. If you think your time in that particular house is short, then consider making some simple upgrades and repairs.
Choosing upgrades is not so difficult, either. Spend a little time looking at the data for our region in the Cost vs. Value Report, talk to your neighbors, and go to open houses. If it turns out that shag carpeting is back in the swing of things, keep it. See what needs to happen for a minor kitchen remodel (for example, bamboo flooring vs. convection oven) and go from there. Certainly, don’t forget those easy curb appeal fixes, too. That new grand entrance may be just the thing that sweeps potential buyers and their realtors when they arrive.
Remember, too, that no matter how much time you expect to be there, though, that infrastructure– a new roof, furnace, and updated electrical and plumbing – will always pay off. There’s not much point in a convection oven if the inspector says the roof is bad or the foundation needs major repairs.
Have more questions? Don’t hesitate to get in touch. Taylor Kolon, Cole Metcalf, and Galen Buchanan are happy to help you handle whatever situation arises as you find your new home.