CLIENTS OFTEN ASK, "How much can I increase the listing price of my home for the improvements I made?" If you put in a new kitchen for $50,000 you should get that back, right? Unfortunately the answer is no because the market never gives you back dollar for dollar. And did you know you can make your home too nice for the neighborhood? If your home is the most beautiful -- and the most expensive -- for the neighborhood then buyers will pass it by and go for a home that is in a reasonable price range for the neighborhood.
"Well someone will appreciate the improvements in my home," you may say. Yes it's true. However, a bank appraiser will ultimately be the judge! A home must appraise for the buyer to get a mortgage. A professional appraiser will compare your home to others in the neighborhood, and give a percentage for your improvements. If the home does not appraise, then your buyer will ask you for a discount -- or maybe walk away.
So it's OK to improve, and certain improvements WILL increase your home's value -- but remember to keep the improvements within a reasonable range!
Here is a great article I found on Bankrate.com by Dana Dratch from November 12, 2014 in their Real Estate Section called, "6 cautions about overimproving your home" It's a quick read and right on the money! Click here to see the entire article.
If you have questions about this, please feel free to reach out.
Cheers!
Mary Churchill
Coldwell Banker
908-930-4800