To Renovate or Not To Renovate
When thinking about selling, homeowners often feel they need to get their house ready with some remodeling to appeal to buyers. However, with so many buyers competing for available homes right now, renovations may not be as vital. We are not in a normal market, and there are so few homes for a buyer to purchase right now. Here are two things to keep in mind if you’re thinking of selling this season.
1. There aren’t enough homes for sale right now.
A normal market has a 6-month supply of houses for sale, but today’s housing inventory sits far below that benchmark. According to the National Association of Realtors (NAR), there’s only a 1.9-month supply of homes available today. As a result, buyer competition is high, and the national average is 21 days. We’ve seen an increase in multiple offers and bidding wars. In Macomb and Oakland County, our month supply of homes for March was averaged at .08 Months.
In a competitive market that’s moving so quickly, it makes sense to sell your house when buyers are scooping homes up as fast as they’re being listed. Spending costly time and money on renovations before you sell might mean you’ll miss your key window of opportunity. While certain repairs on your house may be important, your best move right now is to work with a real estate advisor.
The best way to know for sure is to give me a call to determine what projects will maximize your net profit. We will also discuss which improvements are truly necessary and which ones are not likely to be deal-breakers for buyers.
Will Buyers Be Willing To Make the Home Improvements?
Today, many buyers are more willing to take on home improvement projects themselves to get the home they’re after. They know it means putting in a little extra work. Home Advisor explains:
“When it comes to the number of home improvement projects completed, Gen Z homeowners are leading the pack. Gen Z is completing an average of 3.5 projects. Millennials closely follow Gen Z, taking on an average of 3.3 projects. Right behind them is Gen X at 2.8 projects. Boomers completed an average of 2 projects, and the Silent Generation completed the fewest projects, on average, at 1.8 per household. Compared to 2019, millennials are spending 60% more on home improvement and doing on average 30% more projects.”
In this market, it may be wise to let future homeowners remodel the bathroom or the kitchen. They can make the design decisions that are best for their specific taste and lifestyle. As a seller, your dollars and time might be better spent working on small cosmetic updates. I recommend projects like refreshing some paint and power washing the exterior instead of over-investing in your home with upgrades that the buyers may change anyway. It’s best to work with a real estate professional to determine the key projects that will maximize your listing without overdoing it.
2. Focus on getting a good return on your investment.
When planning any bigger projects to tackle, you and your real estate agent will want to discuss your investment’s potential. What will be your return, and if those projects are worth the cost. Some homes need a kitchen or bathroom renovation, roof repairs, or other major work, but definitely not all of them. You might be surprised by how well your house could fair in today’s sellers’ market. Hanley Wood states:
“The 2020 Cost vs. Value report shows a predictable increase in costs for all 22 remodeling projects but a consistent dip in the perceived value of those projects at the time of home sale, as estimated by real-estate professionals in more than 100 metro areas across the U.S. This results in a slight downturn on the return on investment for nearly all projects relative to the trends we saw in last year’s report.”
What to Tackle?
Ideally, homeowners getting ready to move should try to avoid over-investing in big renovations. Your goal is to make as much money as possible from your investment. If you don’t make that money back when they sell their house, maybe you shouldn’t do it. According to the 2020 State of Home Spending report from Home Advisor:
“The average household spending on home services rose to $13,138, an increase over last year’s survey results, where homeowners who did projects spent $9,081 on average in 2019.”
Before you renovate, contact a local real estate professional to see if it’s the best course of action. You may find out that putting your house on the market as-is will help you sell quickly, and it may result in the best return on your investment. Every home is different, but a conversation with your agent is mission-critical to make sure you make the right moves when selling this season.
We’re in a strong sellers’ market, and that means you have the leverage to sell your house on your terms. Let’s connect today to determine if renovating is really the best way to spend your time and money before you sell.
When You Sell, 🛑 STOP Doing This!
No 2 homes are alike, and agents need to 🛑 marketing 1 size fits all. We no longer have an exposure (internet) problem. Your home is buried on home search internet sites. The only way to compete on those platforms is the price. If you want more money, you need to apply Influence. Separate your home from the competition, so the Buyer sees value. It’s a must to keep them focused on your property and not get lost in homes’ inaccurate data on the public internet sites. Remember MORE INFLUENCE = MORE💰. We have details on how you can utilize High Tech Marketing and Win!
Peek into My Crystal Ball
Seeing this is my 3rd time I’ve been involved in a housing crisis in the real estate business. We will be watching for a shift as our economy and interest rates start bouncing back. There are 3 parts to making the most money on the sale of your property.
- Know the Market You’re In ~ Live 3-year Market Trends.
- My Blueprint to Your 🔑 to 🏡 Buying & Selling Success~ Education is key.
- Prepare a marketing plan that influences buyers.~ High Tech Digital Marketing
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