Adding Value To New Home Purchase For Home Buyers
This BLOG On Adding Value To New Home Purchase For Home Buyers Was PUBLISHED On June 7th, 2019
A home is one’s single biggest investment.
- By owning a home, a homeowner can enjoy and use their investment
- Real estate is considered one of the safest investments an investor can make
- Homes have appreciated substantially over the past few years
- Many areas had over double-digit appreciation since 2012
- In 2018, with rising interest rates, homes have appreciated nationwide
- There is more demand for homes today than supply
- Demand is expected to increase throughout 2019 into 2020
- With the recent news, the FED is going to lower interest rates in 2019
- demand for homes is expected to remain strong
- Many experts believe that home prices will increase in the next few years
In this blog, we will discuss Adding Value To New Home Purchase. There are ways of adding value to new home purchase without spending a lot of money.
Adding Value To New Home Purchase By Updating Home
Unless you bought a new construction home, the chances are that your home needs updating and renovations.
- There ways of adding value to new home purchase by remodeling certain rooms in your home
- Updated kitchens and bathrooms are a great way of adding value to new home purchase
- Not only will you be adding value to new home purchase, but you get to enjoy your investment
- Unfinished basements and attic spaces should be remodeled to livable living areas
- It does not cost an arm and a leg to finish a basement and/or attic
- You can add an extra bedroom and a bathroom
- Many homeowners will also add a small kitchen to their basement and a bedroom to make it an in-law suite
- Tearing out the old carpet and installing hardwood flooring will do wonders
- Hardwood floors will last many years versus carpeting
- Landscaping is mostly labor
- Grass seeds, small shrubs, smaller trees do not cost a lot
Planting small trees right away is very important. It takes years for trees to mature. A 3 feet Blue Spruce can cost as little as $40 per tree. However, it takes many years to grow. Many trees only grow one foot per year.
Best Way Of Adding Value To New Home Purchase
You do not want to have the best home in your neighborhood. Having the largest home in the block is not the best investment. According to Alex Carlucci, a senior vice president at Gustan Cho Associates, most homeowners plan on doing renovations to their homes after moving in. Here is what Alex states:
A recent study by the real estate division of Gustan Cho Associates, more than 1,200 U.S. homeowners about their approach to property, found that 58% of homeowners will “definitely” or “probably” undergo a home renovation or improvement project over the next 12 months. Of those who plan to do so, 65% plan to spend at least $10,000, with 20% budgeting between $10,000-40,000 and 15% spending more than that. But as you make decisions regarding home upgrades, renovation, and major projects, it’s vital to pay close attention to the market value of your home and the homes around you. Pay special attention to what homes top out for in your neighborhood. If they top out at $500,000, and yours is already worth $475,000, you may lose money if your project is more than $25,000. Even that bears consideration because if you spend $25,000, then you only break even. Check the market against your home’s current value, then plan your renovations.
Most homeowners favorite renovation projects are remodeling kitchens and bathrooms. Kitchens and bathrooms do add value to the home. Renovating and finishing basements and attic spaces will create more living space. It is a great investment that homeowners can also enjoy the remodeled finished space.
Landscaping Adds Curb Appeal
Here is what Alex Carlucci says about adding value to new home purchase with landscaping:
Landscaping is probably the best and easiest, most affordable way to increase your home value in the first year, It makes sense—healthy trees, blooming flowers or plants, and neatly trimmed lawns make a house, well, prettier. Adding trees in your property will increase its value. Start planting young shrubs and trees as soon as you move in. Make sure you do not plant them very close. Give it space between trees so it has room to grow to full size.
Larger Scope Repairs With Renovation Loans
Banks are the only financial institutions that homeowners can get home improvement, HELOC’s, and Second Mortgages. However, you need equity in your home to qualify for home improvement and/or HELOC’s. The maximum loan to value banks will lend on home improvement and HELOC’s is 90%. Many homeowners do not have this type of equity after they purchase a home. One option they have is to refinance their current home loan with an FHA 203k Renovation Loan. FHA 203k Loans will pay off the current home loan and the lender will give you the construction funds to renovate your home. You just need 3.5% equity after the improved value to qualify. For more information on FHA 203k Loans, please contact us at Gustan Cho Associates at 262-716-8151 or text us for faster response. Or email us at firstname.lastname@example.org. We may have other cash-out refinance loan programs depending on your equity in your home and credit/income profile.