I am often called upon to do market evaluations for people looking at selling their homes but I’m getting a growing number of requests from past clients wanting to know how much their planned renovation will cost and what the increased value of the property would be too.
There are a number of factors I look at when doing a market evaluation and I haven’t found any program that is more accurate than I am in figuring out what your property is worth, in fact some of the programs out there are downright misleading.
That said, I’d like to share with you a tool that I’ve frequently used to get a rough idea of how much a specific renovation like a bathroom or kitchen renovation might increase the overall value of your home by.
It is called the “Renovation Guide” put out originally by an appraisal company called Henderson and Butt. The latest version is 2009 but it still works as a general reference. I’ve included it here for your benefit:
Now to answer the above question, the “Renovation Guide” using a 1200 sq’ bungalow indicates that a remodeled bathroom will cost you about $10-16k and will increase the value by roughly $6-12.8k. Whereas a kitchen can run you $20-32k for average quality with an immediate increase in value of approximately $14-27.2k.
There are a few things that are important to note when renovating a house or preparing one for sale.
- The first is who are you renovating for, yourself or a prospective buyer? If the answer is a buyer, then try to isolate who that buyer might be, age, lifestyle, etc.
- Secondly, is budget – did you know that the cost equals or out weighs the immediate increase in value on every renovation if you are having it professionally done except for interior painting, which will give you an R.O.I. (return on investment) of 110%.
However, cleaning and decluttering win out by far with as much as a 500% R.O.I.
Before you do any preparation for sale, contact me at firstname.lastname@example.org to arrange an appointment with myself or one of my associates in your area for a free no obligation consultation.
REALTOR®, ABR® (Accredited Buyer’s REALTOR®), SRS® (Seller Representative Specialist)
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