Considering it’s likely your biggest asset, you should know how much your house is worth. Having a clear sense of your home value is crucial if you’re planning to sell your property. But it’s also essential if you want to make home improvements by taking cash out or with a home equity loan or line of credit, as lending institutions will want to know the value of your home before offering you any funds.
Homeowners currently in the market are all too familiar with this question: Should you renovate or sell? And if you renovate, how can you increase your home value—and not just waste money on unneeded changes?
When deciding whether to remodel or list a home “as-is,” there are multiple factors to consider. What’s the expectation in your market? How much work does your property need? And is your local market hot… or slowing down?
However, even in hot markets, some properties sell quickly while others linger for months on end. There may be a cause: The sellers didn’t pay attention to needed repairs. Increasing home value isn’t a one-size-fits-all solution. Each property is different.
How To Increase The Value Of Your House?
External Wall Repair and Painting
The first thing that a potential buyer will see is your home’s exterior, so it’s worth making sure that your home looks its best outside and in. Properties that appear dilapidated, old, or ugly won’t cut. There’s nothing like a fresh coat of paint to make your home look fresh, modern and more universally appealing, but you may wish to shy away from overly bold shades such as lime green, or you’ll make your house stand out for all the wrong reasons. It’s a good idea to consult with your real estate agent or a designer before you get started. There are also virtual painting programs online that can give you a preview.
In addition to giving your home a paint job, you should also examine the exterior for visible damage signs. Walls made of weatherboard may have panels that need replacing. Brick homes may need to have small gaps filled with fresh mortar, and rendered walls can do with fresh concrete to fill in gaps. These minor improvements will make a property look new without the need for a significant renovation.
Upgrade Doors and Windows
Aside from looking stylish, new doors or windows make your home more energy-efficient and can lead to more affordable household running costs and a more environmentally-conscious property, which many buyers are attracted to.
Landscaping and Yard Lighting
Buyers love an attractively landscaped yard, and it doesn’t take too much money to fix yours up if you have space for it. A household’s yard is considered a good indicator of the total amount of effort given to the property: dead plants, messy gardens, or boring yards can be a fast turn-off. Investing in new soil, rocks, shrubs, ground cover, trees, and mulch can help transform your yard, making it appear fresh and inviting. An appealing yard will help sell the property because it invites buyers to picture themselves spending time outside during the year’s pleasant seasons. This can be done on your own if you have a green thumb, or you could enlist the services of a professional landscaper. Be sure to focus on yard lighting because some buyers will only have the time to drive around after dark. Night lighting can create a modern, chic look for your garden.
It may seem strange, but the floor is one of the first things buyers look upon entering a property. People expect their homes’ floors to be contemporary, clean, and stylish. Old, musty carpeting will not do your home any favours. Although hardwood floors are perennially popular and easy to care for, a high-quality carpet can also be quite attractive and create a warm atmosphere. Be sure to fix any flaws in your flooring, and be prepared to replace carpets if they are ancient.
The kitchen is one of the most important communal areas of any home. Buyers want a functional workspace that includes good taps, cupboards, and bench-tops.
It’s a common mistake for sellers to overdo kitchen upgrades with fancy granite or marble bench-tops and all-new stainless steel appliances. Although this looks sleek and modern, some buyers will be turned off by these types of upgrades because they will automatically assume that the house is more expensive. In any case, be sure that all appliances are in working condition and that the kitchen looks tidy and attractive.
Bathroom and Toilet Repairs
As with kitchen upgrades, it’s possible to go crazy renovating a bathroom space with all-new showers, toilets, tubs, and cabinetry. This may not be necessary to add value to your home, provided that your bathroom is in proper working order and fresh in appearance. A good bathroom space will be both functional and aesthetically appealing. Minor repairs like painting the walls and replacing tile grout can work wonders. Clean out your exhaust fan and repair chips in the bathtub or sink to make fixtures look new. It’s also worthwhile in some cases to replace old light fixtures with more user-friendly or energy-efficient models.
Internal Lighting Fixtures
The lighting fixtures’ cost can vary greatly, but if you have old-fashioned hanging lights with paper lampshades, it’s probably time for an upgrade. Lighting is essential when selling your home, as no buyer will want to live in a dark space. Down-lights look good in most environments, and lighting can play up other pieces of decor in the home. Energy-efficient lighting can also boost a property’s appeal.
Painting Interior Walls
There are specific trends that come and go in interior design. You may have noticed that many new model homes come with coloured, ‘feature’ walls rather than blank, white ones. Buyers can interpret a white-walled home as dull and devoid of character, while the right colours can be exciting. However, it’s essential to take care of your paint choices, as something too outlandish may hinder the potential buyers’ ability to see themselves in your property. If you’re using colour, be sure that all the colours blend well together and match other design aspects of your home. Accent walls and textured brush techniques can add visual interest to your property, but consult with an interior designer if you are unsure.
Roof and Foundations
The structure of your home may not be as apparent to buyers at first glance as many of these other factors, but a poor inspection report due to flaws in your roof or foundations could break your sale at the last moment and cost you much more. It’s essential to have a professional come in to inspect your home ahead of time so that you can repair any structural flaws. Buyers will want to be satisfied that their new home is safe and built to last.
Heavy Cleaning and Organising
A heavy, thorough cleaning can work wonders on any property. This part of the process will be cheap, but it will take considerable time and physical effort to do right. Focus on cleaning all the places of the property that you can see, as well as all those hidden corners that you can’t see. Get behind the stove and refrigerator and move furniture to clean what lies underneath. A clean, tidy home with everything in working repair will help you get the best possible selling price.
If you’re going to hold inspections whilst still living on the property, be sure to organise all clutter. Remove all your personal belongings, such as family photos that will hinder the buyer’s ability to put themselves in the house. Get storage boxes and consider getting short-term off-site storage for all your items that don’t fit neatly into cupboards. Remember, buyers will be opening everything and looking everywhere, and neatness (however obsessive) suggests a house that is in good order.
Signs Your Home Is Losing Value
Your Property Tax Valuation Has Dropped
No one looks forward to getting their property tax bill in the mail, but if you find when you open yours that the amount you owe has gone down, don’t be so quick to cheer. First, compare last year’s valuation with this year’s. That lower tax bill could indicate that the county appraiser thinks your home is now worth less than it once was.
More Students in Classes
School districts usually have a set student-to-teacher ratio, such as 20 students for every 1 teacher. But when businesses begin leaving a community, the county collects less in property taxes, which means there’s less money available to pay teachers’ salaries and benefits. When this happens, district officials may start laying off teachers and combining classes. A jump in local class sizes could signify that the local economy is in trouble, and property values could drop as a result.
Your House Is Outdated
Orange shag carpeting and autumn yellow bathtubs may have been all the rage in the 1980s, but today’s home buyers see them as drab and dated. If you haven’t renovated your home in the past 30 years or so, it won’t show well when you put it on the market. In other words, it won’t get the same price as a similar home that’s been maintained and updated.
Nearby Homes Are Selling Low
If nearby homes similar to yours in style and age are selling for less than you think they should, your own home could be dropping in value. Through their real estate agents, potential buyers research recent home sales and make offers accordingly—which means that low prices in the neighbourhood can drag down the cost of your house.
It’s a Buyer’s Market
When the housing market is saturated—when buyers have a plethora of houses to choose from—your home will be in less demand, and its value is likely to drop. If you have flexibility, it’s usually better to hang onto your house until fewer are on the market. When your house has less competition, you’ll stand a better chance of getting an offer closer to what you think your home is worth.
Businesses Are Leaving
If you start noticing vacant storefronts in your local commercial district, that’s a sign that businesses are leaving the community, which means there will be fewer local jobs and opportunities. When companies pull out, real estate values often drop. This is especially true if anchor stores, such as Walmart or Target, leave. You can either try to sell your home quickly before the trend accelerates or wait it out and hope new businesses move in and buoy up real estate values.
Your Home’s Curb Appeal Is Lacking
Your house doesn’t get a second chance to make an excellent first impression. If its curb appeal is dismal, so are your chances of getting the price you want when you go to sell. Make sure your home’s view from the street remains tidy and welcoming by maintaining the lawn, trimming back unruly bushes and shrubs, and keeping the exterior in good repair. If the street facade is looking dingy, it’s worth considering adding a fresh coat of paint or replacing a worn entry door with a new one.
Your Neighbors’ Curb Appeal Is Dreadful
Even if your house is picture-perfect, your home’s value could suffer if your neighbours neglect their houses. While you can’t force your neighbours to clean up their act, you can offer to help them mow and maintain their yard. If they agree, your neighbourhood will be cleaner, and your home value will probably improve.
Your House Has Been on the Market Too Long
According to Realtor.com, while local housing markets vary, according to Realtor.com, the average house spends 85.5 days on the market before it sells. If a home is on the market for longer than the average, potential buyers begin to think something must be wrong with it. To prevent your house from languishing on the market, don’t overprice it. Before you list it, ask the agent to perform a market analysis to determine a likely sales price for your house—and then price it accordingly.
Crime Is Up
No one wants to live in a dangerous neighbourhood. If potential buyers see security bars on doors and windows in your community, your home’s value will drop. While neighbourhood crime isn’t actually under your control, if you feel that your street isn’t as safe as it used to be, consider banding together with your community to start a Neighborhood Watch program. Not only will you end up with a safer neighbourhood and increased property values, but you may also be able to build a stronger, more involved community.
Public Areas Are Being Neglected
When a community starts losing businesses and residents—and the tax revenue that came with them—then budgets must be cut. Parks and recreation areas are often first on the chopping block, so if you notice that these areas are being neglected, it’s a sure sign the community is declining. By the time this happens, home values have probably already been affected.
“For Rent” Signs Are Everywhere
When you’re trying to sell your house, even worse than a glut of houses on the market is a glut of properties available for rent. This often happens when owners have already vacated their homes but have been unable to sell them. They then try to cut their losses by renting out their properties, which is a bad sign for home values in the community.
Banks Are Foreclosing
When businesses and jobs leave a community, homeowners may end up stuck with mortgages they can’t pay. Eventually, the lenders will foreclose on their homes. To attract potential buyers, lenders will often put a foreclosure sign in the yard. The presence of these signs on your street is a home-value killer because buyers are reluctant to purchase in a declining neighbourhood.
Ways To Determine Home Value Without An Estimator
With A Real Estate Agent
Real estate agents have access to better tools. They can run a comparative market analysis based on the information they gain from the local Multiple Listing Service, which has a complete rundown of all sales in your area.
Real estate agents will also go beyond comparable sales and consider what makes your home different. They’ll factor in the condition of your home, the number of rooms, the upgrades and improvements you’ve made, etc. They’ll consider all of the features that your home has that the comps lack.
Another benefit of speaking to a real estate agent is that they can offer tips for how you can increase the value of your home. While an appraiser will come by and provide you with a final estimate of your home value, a real estate agent will show you how to improve it. With their knowledge of the industry, they’re able to create a punch list of minor repairs and updates that can help you get more money for your home.
With A Home Appraisal
Home appraisals are often considered the ideal way to determine your home’s value. While a real estate agent will provide you with a home valuation based on what the agent thinks your home will sell for, an appraiser will tell you how much your home appears to be worth.
Lenders tend to rely on appraisers for home valuations because they consider the appraisal process slightly more rigorous. Appraisers will run comps just like real estate agents, but they’ll dig deeper into the public records, research more information about your neighbourhood and complete a thorough inspection of your home.
Appraisers will open every door, turn on every faucet and check every appliance. They’ll examine the structural integrity of your home and the condition of your electrical, plumbing and HVAC system.
Home appraisals tend to cost at least $300 – $400, which is why some homeowners prefer to get the opinion of a real estate agent instead. Even if you do get your home appraised before putting it on the market, your home will more than likely be appraised again when any potential buyer inquires about financing.
Remember, several factors will influence your home value. The big ones will be your home’s square footage, the number of bedrooms and bathrooms, condition, location and the recent sales nearby.
You can use a home value estimator to get a basic idea of what your home is worth, but for a more accurate assessment, speak to a trusted licensed real estate agent or spring for a home appraisal. If you’re considering selling and are in the market for a new home, speak with a mortgage expert today!