home renovation Archives - Page 2 of 7 - Real Estate News and Commentary

April 27, 2019December 13, 2022

Home buyer preferences

Homes can vary along a spectrum of many factors. Size, style, location, are just the basic differences and are generally used by home buyers in their home search. However, even similar homes in the same neighborhood can differ depending on the homes’ features. Home buyer preferences and trends toward home features is usually the reason for price differences on similar neighborhood homes. This truth was validated by a study conducted by the National Association of Home Builders (How Features of a Home Impact Its Price; nahb.org; November 30, 2004). If you’re selling this spring, consider home buyers preferences and current home buyer trends.

In past columns, I talked about how most home buyers in the current housing market want a turn-key home. And that still holds true. Home buyers still prefer to buy a new home. However, buying a recently updated/renovated home is the next best thing. Generally, homes with new kitchens, bathrooms, and flooring get multiple offers and sell very quickly. Alas, updating and renovating a home takes time and money. Discuss with your listing agent how making (or not making) updates and renovations affect your sale price. You may have to adjust your pricing expectations accordingly.

So, what tops the list of home buyer preferences? The National Association of Home Builders latest “Trends in Home Buyer Preferences” (nahb.org) indicates that the kitchen is a prime area of focus. Current kitchen trends include a strong preference to either “traditional” or contemporary style cabinets. The styling would depend on the kitchen overall (consulting with a design center would be helpful). Additionally, water filtration has also become a desirable feature. If not already installed, water filtration can be added when replacing a refrigerator, as it is now a common function of modern refrigerators.

In today’s growing awareness of environment and sustainability, it’s a given that home buyer preferences show a strong preference toward energy efficiency. When updating, consider Energy Star (energystar.gov) certified appliances. Energy Star appliances typically use 50 percent less energy than standard models. Additionally, consider having an energy audit prior to listing your home. The energy audit will reveal the home’s energy efficiency. It will also highlight where improvements are recommended. The report itself is useful to the home buyer, even if you don’t follow all the recommendations.

New flooring is also important to home buyers. The preference towards wood flooring has always been strong. However, be aware that there are differences in quality of flooring products, as well as workmanship of installers. Even if you purchase top quality hardwood, poor installation can actually negatively impact the sale price. If you’re installing wood, tile or similar flooring, hire an MHIC licensed flooring contractor. Your flooring contractor can also help with trendy flooring options.

As a home seller, you certainly consider your home as being special. And you probably spent a good amount of money on customizing your home over the years. However, a problem many home sellers encounter is that over customization and personalization can negatively affect the home sale price. The truth is that home buyers have preferences too, and their preferences may not reflect yours.

Home buyer preferences and trends are constantly changing. Your listing agent should be able to help understand how current home buyer preferences and trends impact your home sale. Additionally, consulting with a home staging or interior design professional can assist you with deciding on making relevant updates to your home.

Original published at https://dankrell.com/blog/2019/04/27/home-buyer-preferences

By Dan Krell
Copyright © 2019.

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

January 12, 2019July 23, 2019

Occam’s razor home selling

Occam's razor and selling a home — Staging is one of the four basics of home selling. (infographic from nar.realtor)

Many home owners are preparing to sell their homes this year. And in doing so, home sellers are looking for new and exciting ways to sell their homes fast and for top dollar. But the reality is that selling a home is not rocket science. There really isn’t a secret trick or approach to selling a home. Rather, it’s more like magic, where properly performed fundamental tasks can set the stage for a satisfying experience. If you don’t know how Occam’s razor (or what it is) can help you get the most from your home sale, pay close attention.

Unfortunately, it’s a human trait seek a complex solution to a simple question. In other words, applying Occam’s razer to your home sale can save you time and allow you to get out of your own way. Occam’s razer is a tool that is often used to figure out solutions and devise scientific theories. It has become popularized as the “keep it simple stupid” method. However, Susan Borowski’s history and explanation of Occam’s razor, written for the American Association for the Advancement of Science, gives it teeth (The Origin and Popular Use of Occam’s Razor; aaas.org; June 12, 2012). Borowski states, “Occam’s razor doesn’t necessarily go with the simplest theory, whether it’s right or wrong; it is not an example of simplicity for simplicity’s sake. It merely tries to cut through the clutter to find the best theory based on the best scientific principles and knowledge at the time.”

In other words, focus on the tried and true fundamentals of selling a home. Anything above and beyond may not necessarily help to sell the home faster or for more money, but could help make the process more enjoyable. That in mind, let’s consider these four basic concepts:

First, consider the condition of your home. Do you have deferred maintenance issues? Does your home need a makeover? Homes that get top dollar are “turnkey.” Many home buyers are willing to compete and pay more for recently upgraded and renovated homes. Selling a home with deferred maintenance or lacking recent updates can not only turn off many home buyers, but can encourage low-ball offers. A pre-listing home inspection can help you identify maintenance issues. Also, consider consulting with a design professional to help you understand which updates (if any) are necessary to help your home sale.

Next, work on the home’s presentation to give it a clean and spacious feel. Decluttering is one of those tasks that can be overwhelming, but it’s importance cannot be overstated. Decluttering will force you to decide which items to keep in the home. Additionally, staging your home can help balance space, furniture and décor. This can help home buyers envision living in the home.

Deciding on a list price is often a conundrum. Although enticing, don’t be seduced by the agent who tells you the highest sales price without understanding their rationale. The housing market can turn on a dime. If your home isn’t priced correctly, it can languish on the market. There are many aspects that go into deciding a price, so work with a respected seasoned agent to go through the market details and scenarios.

Finally, when the home is ready to list, how is it to be marketed? Today’s MLS listing syndication takes advantage of the fact that most home buyers actively search homes on the internet. Don’t rely on gimmicks that promise activity on your listing. A complete marketing plan will take into account the factors we discussed here, and apply strategies to attract motivated home buyers.

Original published at https://dankrell.com/blog/2019/01/12/occams-razor-home-selling/

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November 17, 2018April 25, 2019

Home sale renovations

According to the National Association of Realtors (nar.realtor), the average time a homeowner stays in their home is ten years. This is higher than the seven-year average prior to the great recession (but is less than the thirteen-year average immediately following the recession). Needless to say, many homeowners are approaching (or have exceeded) their ten-year stint, and are likely selling their home during the spring and will likely be doing home sale renovations.

Any home sale preparation in today’s housing market should include some home sale renovations. If you haven’t replaced the home’s systems (such as the roof or HVAC) while you lived in your home, there’s a good chance that they are approaching or have exceeded their average life expectancy.

Additionally, the décor and fixtures in your home are likely outdated. The home sellers who make the mistake of not updating or renovating before they list inevitably face home inspection issues. They ultimately find that the home takes longer to sell at a reduced price.

Let’s face it, remodeling can be expensive and overwhelming, especially when it’s for home sale renovations. According to the NAR’s 2017 Remodeling Impact Report, about $340 billion was spent on remodeling projects in 2015. Although a majority of homeowners would remodel their home themselves, thirty-five percent would prefer to move instead of remodeling their home.

The Report cited functionality and livability as the top reasons for home sale renovations. It’s a no-brainer that home buyers prefer homes that are functional, comfortable, and sustainable. Aesthetics is not enough for a home to be appealing to today’s home buyer, it has to fit their life style. Additionally, home buyers want efficient systems in their new homes that can help save on utility costs.

Home sale renovations should focus on functionality and livability

What projects will get buyers who will pay top dollar into your home? It should be no surprise that the number one interior project, listed by the 2017 Remodeling Impact Report, is a complete kitchen renovation. Other essential interior projects include renovating bathrooms, installing new wood flooring, creating a new master suite, replacing the HVAC system, and finishing a basement or attic.

It also shouldn’t be a surprise that the Report listed replacing the roof as the top exterior project. Other exterior projects in high demand include new windows, new garage door, new siding, and installing a new front door.

If you want to add value to your home, even if it’s not for home sale renovations, check the 2018 Cost vs. Value report (costvsvalue.com). The report can give you insight to which remodeling projects are the most popular, and estimates how much of the cost you can potentially reclaim when you sell your home.

There’s no doubt that renovating your home can be expensive. Although the costs of home sale renovations can tempt you to cut corners, don’t. Cutting corners on renovation projects can actually cost you more. You may have to repair, or even re-do the project if not finished adequately. Home buyers are savvy, and can spot low quality materials and poor workmanship.

Also, make sure to get permits when required. If the home buyer doesn’t ask you, the home inspector will likely recommend that the home buyer check for permits.

Although many homeowners don’t mind a DIY project, many hire home improvement professionals. When hiring home improvement professionals, check with the Maryland Home Improvement Commission (dllr.state.md.us/license/mhic) to ensure they are licensed contractors. You should also ask for proof of their insurance, including Workman’s Comp insurance, in case there is an accident on your property while completing the project.

If you hire a contractor who will accept payment when the house sells, read your contract carefully and thoroughly. Do your due diligence. There may be provisions in your contract that you may not be aware of, such as added costs, charging interest, and setting/lowering the sale price.

Original article is published at https://dankrell.com/blog/2018/11/17/home-sale-renovations

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June 14, 2018April 30, 2019

Specialty rooms for all interests

Prior to the Great Recession, home owner spending for remodeling and renovations was very strong. Besides remodeling the kitchen and bathrooms, many home owners also created specialty rooms (also known as special function rooms) in their homes. Specialty rooms such as home theaters and media rooms were not just trendy because they were cool to have in the house, but they also added resale value. According to Kermit Baker writing for Harvard’s Joint Center for Housing Studies, post-recession home remodeling spending dropped off by as much as 28 percent between 2007 and 2011. That spending decrease meant that while home owners focused on saving and paying their mortgages, specialty rooms were no longer a necessity.

The return of the specialty room can be measured by the increased home remodeling spending over the past few years. Specialty rooms are increasingly in demand. The recent LIRA press release projects that home remodeling will remain strong at least through 2019. Chris Herbert, Managing Director of the Joint Center for Housing Studies stated:

“Strengthening employment conditions and rising home values are encouraging homeowners to make greater investments in their homes…Upward trends in retail sales of building materials and the growing number of remodeling permits indicate that homeowners are doing more—and larger—improvement projects.”

Prior to the Great Recession, specialty rooms were a must for home owners. However, many of these specialty rooms were primarily added for display and resale. Home owners have since moved away from the large gaudy specialty room and are opting for more practical spaces focused on enjoyment and function.

Several years ago, panic rooms were in demand for protection. It wasn’t just to protect from a home invasion, as portrayed in the movie “Panic Room,” but also to offer shelter from severe weather. FEMA even provides information on creating a safe room in your home.

Yes, specialty rooms are becoming popular again, but not in the way they were prior to the recession. According to the 2017 AIA Home Design Trends Survey (aia.org), creating an outdoor living area is the currently the most popular specialty room today. The outdoor living area is a way to extend indoor space and amenities (such as kitchen and home entertainment) to your back yard or roof top deck.

But home owners are opting for other specialty rooms too. Building a fabulous mudroom comes in second in the AIA Home Design Trends Survey. No longer that meager alcove separating the garage and kitchen, the mudroom has become a multi-purpose functional suite. Obvious coat hooks, benches, and shoe cubicles are standard. But mudrooms have become larger to accommodate storage units and desks, typically with high-end flooring and moldings.

Other specialty rooms mentioned in AIA’s survey include the home office and in-law suite. However, other types of specialty rooms that are popular include fitness rooms and wine cellars.

As the economy improves, home owners have more money to spend on their passions. Currently, there is a trend to build specialty rooms to help home owners pursue hobbies and talents. Hobbyists are creating spaces for their collections and interests. Many home owners are designing dedicated rooms as art studios. Music lovers and musicians are finding that technology has made the music listening room and recording studio easy and affordable to create in their homes.

Over time, the home has evolved from a Spartan shelter to a space where we relax and express our personalities. It is likely that specialty rooms will continue to evolve based the home owner’s lifestyle, finances, as well as technology. Specialty rooms will also vary based on societal norms (consider formal dining and living rooms) and economic conditions.

By Dan Krell
Copyright © 2018.

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May 20, 2018May 5, 2019

DIY Do It Yourself

DIY — Do it Yourself projects may need permits (infographic from census.gov)

Home owners are spending more on home improvements. “Do-it-Yourself” (DIY) projects are becoming popular again. Besides being inspired by the increasing number of DIY home improvement shows on TV, there are numerous books, online sources and YouTube videos to show a DIYer how to take on almost any project in the home. Being a DIY is ambitious and exciting, but for many becomes overwhelming and costly.

The notion of DIY is more than just being proud of getting your hands dirty. For many home owners it’s really about money. DIYers have a reputation for being thrifty, but a revealing research analysis asserts there’s more to it. Ryan H. Murphy (The Diseconomies of Do-It-Yourself; The Independent Review; Fall 2017; pp.245–255) provides ample evidence that many who engage in DIY have an anti-market bias. Those who engage in DIY home improvements believe it is a zero or negative sum game, where there is no benefit from money spent on the home improvements. He concludes that unless home improvement is your vocation, you’re better off sticking to your profession and hiring a (licensed) professional home improvement contractor.

One of the issues that is often noticed with DIY projects is that the result may be substandard. The home owner may decide that although the project is not completed, it is “good enough” to save time and money. Sometimes, the “good enough” attitude is evident by jerry-rigged components. This can obviously be a problem when selling the home. Home buyers have a keen eye and will be turned off by poor workmanship. Even if the home buyer misses it, you can count on a home inspector to flag it.

Permits seem to be another issue for many DIYers. Some believe that obtaining a permit (when it’s required) is costly and time consuming. However, inspectors are getting better at sniffing out unpermitted projects, so it is common for the DIYer to get caught before completing their improvements.

The permitting process may increase the time and cost for your DIY project, but it’s there to assure that buildings and home improvements adhere to the building and zoning codes within the city or county. Building and zoning codes are devised to help ensure that buildings are safe. Finishing a project without a required permit can potentially cost you more money and time down the road.

If you are required to get your unpermitted DIY project inspected after completion, don’t be surprised that you may have to make alterations and/ or corrections to your work. If you built a structure that is deemed unsafe or even encroaches on a neighbor’s property, you may even have to demolish the project and start over. You may even have to hire contractors to assist you. If you are selling your home, the home buyer may require you to have your work inspected. It can be even more costly if the project was completed during past code cycles, because, rather than send county inspectors, you may be required you to hire experts to inspect your work.

If you’re planning a DIY project and not sure if it needs a county or city permit, check with your municipality’s permitting office. Here in Montgomery County MD, the Department of Permitting Services’ website lists additions and alterations that require permits (permittingservices.montgomerycountymd.gov). However, if you live in one of Montgomery County’s county’s incorporated cities, your city may have different permitting requirements.

By Dan Krell
Copyright © 2018.

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