House Size
Some people think bigger is better, whether you're talking about cars, hair engagement rings or breakfast. Things that are larger than life are often fascinating and there are certain people who spend their lives competing for the biggest piece of the pie literally and figuratively. This is because size is almost always equated with quality.
Interestingly the person with the biggest piece of the pie may not be the most knowledgeable investor when it comes to homeownership. In this case, other homeowners often get to bask in the glory of the pie while the guy who bought the biggest piece just gets fat.
In other words, the biggest home in a particular neighborhood will not be the one that appreciates most in terms of resale value. This is because the people who can afford to live in opulence won't necessarily want to do so on a residential street where all of the houses are smaller and much less extravagant, but on the other hand the houses that surround a glorious, if not completely out of place, mansion will appreciate in value simply for existing in the shadow of opulence.
Size Matters
Size and location often go hand in hand. It is usually smarter to buy a small house in an extremely nice neighborhood, than a large place in a more rundown neighborhood if you are concerned at all with resale value.
Small and medium-sized houses can be great investments in terms of resale value. These places are often more inexpensive than large houses and they can be remodeled and added onto to improve their worth.
When you remodel to improve resale value you have to put your individuality aside and instead concentrate on what is saleable. This is where most people go wrong. When a homeowner's pride drowns out the logic of investing there may be trouble. Often homeowners will add on giant additions, huge decks, ponds and other gaudy accents because these added touches suit their taste. The problem is, they usually don't suit anyone else in the general population. Remodeling to achieve resale value is not about expressing your feelings and making a statement, it's about making money.
As boring as it may be to remodel your house only slightly to address its spatial deficiencies this will ultimately provide you with a highly saleable piece of real estate.
There are strategic ways to remodel to achieve high resale value. These strategies often deal with expanding the size of specific areas in the house rather than expanding the overall size of the house itself. The most important thing to consider is what the general population is looking for in a new home.
Some Remodeling Projects that Improve Resale Value:
- Kitchen remodeling and expansion
- Adding a bathroom
- Revamping an old bathroom
- Adding a fireplace
- Adding a living room
- Adding a home office space
- Building a deck
- Adding accents like hardwood flooring, marble countertops and updated fixtures and hardware
Even though the size of a house doesn't necessarily matter, the size of a house's kitchen and bathrooms matter quite a bit. Everyone knows that the kitchen is the social center of a home so it has to be spacious. Kitchen remodeling and expansion is also practical. No one likes to cook in a cramped space, sweating right next to a hot oven.
Adding or revamping a bathroom can also be extremely practical. Most buyers will refuse to invest in a house that has one bathroom no matter how small the house may be. Adding an ensuite bathroom to a master bedroom, or a bathroom to the floor in your house where one doesn't currently exist doesn't say luxury but it does say sensibility and sensibility is extremely saleable.
Though increasing kitchen and bathroom space in your home is sensible in terms of resale value, there are still a few things to think about before the project gets under way.
Before You Remodel Your Kitchen or Bathroom Consider:
- Will the remodeling bring more potential buyers into the house?
- How will your house stack up to others on the block once things are remodeled?
- Will the improvement seem extravagant?
- How much will the project cost?
- Is there any way to cut costs without losing aesthetic value?
- How much money will you recoup from the cost of the remodeling?
If you can't answer, "I will make back all the money I spent and more" to this last question you're remodeling project may not be a good idea when it comes to resale value.
A fireplace can be a nice addition to improve resale value. Usually adding a fireplace will cost a few thousand dollars and involve minor remodeling but this cost is normally absorbed when the house is sold. There is something about the ambience that a fireplace lends to a home that just seems priceless.
Adding a living room can also be a good investment. It can expand the size of a house a bit, but not usually enough to make it stand out like a sore thumb. This project is a good idea in small homes that have a sizeable kitchen, a den and a dining room but no real place for lounging with guests. The addition of a living room typically costs at least $20,000, but there is no doubt that it will pay for itself in beauty, sophistication and resale value.
Add a home or office space can be lucrative in artist communities and other areas where people tend to work largely from home. It can be expensive, as is the addition of any sort of room, so it's important to assess the importance of this added feature to the sort of people that are drawn to your particular area before beginning construction.
Decks can be a great investment to improve resale value. Forty years ago hardly anyone had an outdoor deck or patio, but this feature has become so popular over the last few decades that nowadays hardly anyone will buy a house without one.
Adding subtle distinction is the most cost-effective and easiest way to add resale value with out changing the size of a house. Hardwood floors are always a great idea and some flooring you can even install yourself. New hardware and fixtures also make an instant difference when it comes to making a good first impression on a potential buyer. These small, added touches allow homeowners to dramatically improve their home's appearance without getting out the sledgehammer.
One of the most effective and efficient ways to improve resale value actually has nothing to do increasing the size of a house. Money that homeowners have put aside for garish additions is usually much better spent on practical amenities that most people will never see: the heating and cooling systems. Studies have shown that above all structural additions, adding a brand new furnace or air conditioner to a house will almost always increase its resale value.
Before Expanding
Before changing a house's size or beginning any remodeling project to increase resale value there are a few things to consider. The first is current market and property values. In a slow market any remodeling project will result in less money recouped and earned because people will be paying less for houses. The second thing to keep in mind is the forecasted popularity of the remodeling project. For example, adding hardwood flooring has been popular for quite a few years and as more and more people catch on to this trend it will likely remain popular for years to come. Cost is the third and most important thing to consider because getting carried away and investing too much money in a useless project could be financial suicide.
A house is the most important investment that most people will make in their lives so the practicality of this investment is essential. The theory that bigger is better is really just a theory of extravagance and gluttony and for this reason it doesn't really transfer over to homeownership, especially for homeowners interested in buying homes with resale value. The average homeowner who purchases a huge home, especially in an average area, will have an extremely hard time when it comes to selling this home and making money.
For the average homeowner a large home is like a giant, fatty meal: it may look great and make other people drool, but most people will pass on it no matter how great it looks in favor of something more sensible.
