Home Improvement After Home Purchase
Home improvement can be a good investment and add value to your home, however, you do not want to over improve your home. Right hand rule is that you never want to own the biggest home in the block if do not intend in living there for the rest of your life. Many new home buyers want to update their home after they close on their home purchase such as painting, flooring, new fixtures, new appliances, landscaping, basement remodeling, and attic remodeling. Others go to major renovations such as adding a new room addition, swimming pools, outdoor kitchens, and extensive major landscape such as adding a pond, waterfalls, basketball courts, tennis courts, and other unique improvements.
Home Improvement Projects: Good Investment Versus Bad Investment
One of the biggest mistakes homeowners make is that they assume if they invest in their home via home improvement projects that it will add value and they can recoup their home improvement costs when they sell their home. This is partially true if they do the right home improvement project. Certain home improvement project such as remodeling an unfinished attic or basement is an excellent investment and homeowners will definitely get their investment back plus a handsome return on their investment without having to spend a ton of money.
An unfinished basement with a high ceiling can be finished and turned into a nice recreation room with a guest bedroom, office, wet bar, kitchen, and storage space. Basement remodeling does not cost too much money if the homeowner contracts with a reasonable general contractor. A finished basement is a great investment and utilizes an unused space into a liveable space. A remodeled basement can add $25,000 or more in market value when the homeowner sells their property. It normally costs anywhere between $10,000 to $15,000 to remodel a basement which includes a bathroom and wet bar/kitchenette.
Remodeling Unused Space
An unfinished attic can easily be converted to a finished attic with a guest bedroom, bathroom, and storage area. Pitched roofs can be cut and a dormer can be added. It does not cost an arm and a leg to remodel an attic and homeowners can get a great return of their investment when they sell the home plus they can enjoy the additional space while owning the home.
Projects like in ground swimming pools, out door kitchens, tennis courts, basketball courts, oversized decks, ponds with waterfalls, and other specialized unique home improvement projects will not add value to the home but the home may sell quicker due to having unique ammenities. These home improvement projects cost thousands of dollars and the homeowner if free to do whatever he or she wants but if they think they will get a great return of their investment, they have it wrong. There are many cases where a home buyer does not want an in ground pool due to liability reasons if they have smaller kids. I have seen cases where a home buyer hired a contractor to fill in the in ground pool after they closed on their home because they had younger children.
Over Improving Your Property
A white elephant is a home that is oversized and over improved in the area. Some homeowners make the mistake where they go nuts in over improving their home. If you own a 2,000 square feet home and do a 3,000 square feet addition, you now own a 5,000 square feet home. Are there 5,000 square feet homes in your area? If not, you will have a very hard time refinancing your home or selling your home if the appraiser cannot get any similar and like homes in your area to use it as a comparable.
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