How to Maintain the Value of Your Home
Thinking of selling? Step back and take a good hard look at your home. Separate yourself from your house. You can’t be forgiving because potential buyers won’t be. Why should a buyer pick your resale home over a new home or the one down the street? Condition is critical.
First, a home owner must understand the difference between updating and retaining the value of a house verses making value-added improvements. Real estate is an investment. Its appreciation is dependent on its condition. If carpeting is stained or worn and it is replaced with new carpet, you are keeping your home investment value intact. If you take the same worn carpet and replaced it with hardwood floors, you’ve made an improvement and added value. If you’ve decided replacing the carpet is too much trouble or cost, you have just lowered your investment’s value and made it harder to justify your selling price to a potential buyer. This is the challenge and the opportunity for a resale home.
The hot seller’s market has ended its long run and now the buyer is getting the upper hand. With economic slowdowns buyers hard-earned dollars won’t buy as much as it used to. They expect a lot of value for their money. They also value their time more. Forty percent of buyers are first-time buyers. They expect something contemporary and most aren’t as handy or DIY oriented as the generation before. They want it all, for as little as possible – it’s human nature.
Determine why someone should buy your home as opposed to the one down the street for sale. What differentiates you from your competition? The home must be very competitive and show off its best assets. Daily condition issues we often become blind to or learn to live with can be immediate deal breakers for buyers. Just because a home is in a desirable neighbourhood does not entitle the seller to the average selling price if its condition has not kept pace with its neighbours.
To get top dollar value for your house it must be in great retail condition. You’re probably thinking it’s not that bad, and I’ll just put it on the market and see what happens. You might get lucky if the market in your area is hot, but the market everywhere has cooled. Buyers can pick and choose. Why take the chance of languishing and depreciating your asking price while on the market? Your greatest activity will occur during the first week on the market. Don’t put your best opportunity to sell at risk with a flat delivery.
A recent seller commented that they knew their house was outdated, but it wasn’t as outdated as some other homes they’d seen. The seller didn’t understand that to a potential buyer there isn’t a different between being 15 years outdated or 30 years outdated. It was out-dated. A potential buyer would still be mentally adding up the cost of replacing flooring, appliances and fixtures to bring the home up to speed. It’s not uncommon to spend money to improve the value of the home only when we’re ready to sell, rather than make the updates ongoing and enjoying the benefits. Learn how to appreciate your home value.
If a home has condition issues, the seller has to be realistic in their expectations of selling price. A realtor will give you the expertise you need. No one buys an end of year model or something with obvious flaws in a retail market without asking for a discount. Selling “as is” will greatly limit your market and price potential. As an expert in your market and neighbourhood, your Realtor will recommend a realistic and competitive selling price.
There is good news if you’ve been living in the same home for a while. You have the advantage of built-in equity. Consider using some of the equity to update and freshen before you sell. Not only can a mortgage broker provide additional help with equity, they can also help you get prepared for the next home purchase.
If you’re thinking of selling or have been on the market for a while, get professional real estate advice. Be very strategic on where to spend your money to retain value and where it may be better to make improvements. Get a professional home stager involved to help you “up” your market appeal and make a splash in presentation. Your don’t get a second chance to make a first impression.