7.95, that’s how many years the average American homeowner lives in their home, according to the number crunchers at Attom Data.
Whether you are at the beginning, middle, or end of this nearly eight-year period, you will sell your home someday. While it’s great to renovate for your comfort and enjoyment, keep in mind that what you do to the home now may have an impact on both how long the home takes to sell and how much money you’ll have afterward.
In other words, investing $25,000 in remodeling will not necessarily mean you can tack on an extra $25,000 to the asking price when you sell the home.
Let’s take a look at some of the worst renovations you can make if you hope to get a payoff when you sell.
Installing wall-to-wall carpeting or hardwood flooring
Yes, there was a time when new wall-to-wall carpeting or hardwood flooring would boost a home’s value. Those days are long gone.
The fact that flooring-giant Armstrong sold off its hardwood line is a tip that Americans are officially out-of-love with hardwood floors. And carpet?
Lowe’s had such a hard time selling carpet that they decided to offer free installation. To no avail; they still saw a nearly 8% decrease in carpet sales.
Today, homebuyers prefer luxury vinyl and will discount their perceived value if they need to replace flooring after moving in.
Converting the garage
Garage conversions are far more popular in some areas than they are in others. They are especially popular in older neighborhoods with small homes but not in the midwest.
Hey, who can blame someone for converting a garage into a bedroom when they need the space?
Just don’t expect that the conversion will translate into more money when the home is sold.
In fact, “If it’s not permitted, they’ll have a problem selling,” cautions George Holmes of Eagle Appraisal of Las Vegas. And, if is permitted?
“It depends on the price class of the home,” Holmes said. “If it’s a cookie-cutter home and it lacks a 2-car garage, we’ll deduct $8,000 to $10,000 from the value. It’s not cut and dry, however,” he cautions.
You can almost count on your home appraising for less than similar homes that have garages.
Permanent Conversion of a Bedroom
Bedrooms add value to a home. Often, however, homeowners permanently convert the third bedroom into an office, a gym, or a family room.
While there is nothing inherently wrong with adding any of these conversions, if you can’t change the room back to a bedroom when you sell the home, the value of the home diminishes.
Since you now have only two bedrooms, the appraiser will compare your home to other two-bedroom homes.
Better Ways to Spend the Money
No matter how much you renovate or remodel a home if deferred maintenance rears its ugly head, you will lose money on the sale of it big time.
Put your home renovation dollars toward the less sexy projects: new heating, plumbing, and electrical upgrades and anything that boosts the home’s curb appeal.