Not sure if you should renovate your home before putting it on the market? While this question doesn’t have a right or wrong answer (as it’s dependent on the specific situation of each homeowner) it is something I get asked often. Here are some of the main factors to keep in mind when deciding whether it’s smart to renovate before listing.
Define Your Target Audience
Begin thinking of your home as a product: Which demographic will it target? What will the future buyer want from it? For example: if your house was designed with a family in mind, is less than 2,000 square feet and is in a quiet residential sub-division with good schools, your target audience is more than likely young families. This could mean the prospective buyer would want a turnkey home. If the buyer has a young child, they may not want to go through the renovation process and would rather pay a little extra for a space they can move into right away. If you think this is the case, then consider renovating, as you should see a good return on your investment.
Keep an Eye on the Market
Another aspect to consider is the state of the property market. Is it a seller’s or buyer’s market? Ask your realtor for input: he or she should be able to inform you on how the market is performing in your area. This will help guide your decision. If the market is in favour of sellers, then increasing your home’s value by renovating might be the right move.
Consider Your Home’s Condition
If your property requires a lot of modernization – maybe it hasn’t been touched since the 1980s and needs a complete overhaul to appeal to certain buyers – think twice before renovating. This is obviously a personal decision, but taking on a large renovation can unveil a series of issues that could turn your home into a money pit. The tactic here might be to leave your home as is and reduce the price based on the need for renovations. While you won’t be able to sell for as high, it could be a savvy financial decision in the long run.
Remember: Some Buyers Prefer to Renovate Themselves
Many prospective buyers are able to look at a home and envision how they would change it, from where to move walls to how to arrange furniture. Others find it difficult to manipulate a layout to meet their needs, therefore they prefer a home that already has the floor plan they desire. This is why you’ll need to determine which type of buyer will be drawn to your home.
All in all, when family and friends ask me this same question, I probably recommend selling a home in its current state more than I do upgrading it. I’ve renovated many spaces, and the number of issues that come from opening up walls can be exponential.
No matter your choice, remember that living through a renovation is a stressful process, and it’s important to determine whether the financial gains will be worth the strain of a renovation. While it’s not always an easy decision, I hope this helps you make the right one.
Photos courtesy of Jarrett Ford Photography