Article sourced from my Fall 2017 Newsletter
It is always a good decision to maintain your property and invest in long-term, energy-efficient improvements. In addition to making your home more comfortable to live in and reducing your energy costs, upgrading your property over time will add to the home’s appeal when it comes time to sell.
When making improvements to your home, remember that some renovations are significantly more profitable than others. Be rational and avoid excessive luxury – your financial investment must remain reasonable in relation to the value of your home and the other properties in the neighbourhood.
Some renovations are significantly more profitable than others
If you’re thinking of selling in the short term, focus on improvements that are small, but effective: declutter, repaint in neutral colours, replace doorknobs, upgrade lighting, improve storage spaces, etc. Experts recommend looking at your surroundings as if you’re seeing them for the first time and making changes based on what will appeal to the masses.
A varying return on your investment
According to the Appraisal Institute of Canada, kitchen and bathroom renovations give you the most bang for your buck. The yield on high-quality renovations in the kitchen or bathroom – where we all spend time at one point or another during the day – can reach 75 to 100% of the costs incurred. In other words, when we sell our property, we can expect to recover 75 to 100% of the amount we invested. These renovations thereby protect the value of your home.
The same theory applies to all of a home’s essentials. New outdoor siding, an improved heating system, and new doors and windows provide a return of 50 to 75%. The installation of central air conditioning and new roof shingles provide a return that fluctuates between 25 and 75%.
For a quick and easy upgrade, exterior and interior painting ensure an attractive return on your renovation costs at 50 to 100%. New floor coverings and a finished basement follow close behind at a return of 50 to 75%.
Renovations that have little effect on property value
Although installing a pool provides hours of enjoyment during the summer months, it, unfortunately, is not a good investment and provides a poor return on investment at 0 to 25%. Some buyers may also be turned off by the maintenance required by a pool. However, a spa can provide a rate of return of 0 to 50%.
A beautiful home, inside and out
Don’t forget about curb appeal. Potential buyers can be turned off by old and peeling exterior paint, or by a neglected driveway or flowerbeds. Taking care of your home’s exterior can help you get top dollar.
Ask your real estate broker for advice
Even with a modest budget, it is possible to refresh your property and increase its value. Your real estate broker can provide you with appropriate advice. They will look at your property objectively and recommend improvements that are profitable.
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