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RESIDENTIAL

Are Pre-Listing Renovations Worth the Investment?

If you’re looking to sell your home, you may be wondering if it’s worthwhile to invest in renovations that you will not be able to enjoy? Why dump more money, time, and energy into a property you will no longer be living in? You may be surprised to hear that the vast majority of sellers invest in home improvements before listing their property.

WHY DO MOST SELLERS INVEST IN PRE-LISTING RENOVATIONS?

This is due to the nature of demand for buying a home. According to a study done by Harris Insights and Analytics, 80% of Americans would prefer a move-in ready home over a home listed as-is. Most Americans don’t want to spend time on renovations and simply want their move in process to be as easy as possible.

Fortunately, this is actually good news for sellers.  While renovations do require some effort on the side of homeowners, the return on investment for these updates are substantial when compared to the offers you would see for your property as-is. After all, only 20% of all American home buyers are really interested in buying a home that will require more work. Not to mention, most of these buyers are investors who will more than likely offer under asking price in the hopes of profiting off the lack of pre-listing preparation.

HOW MUCH CAN PRE-LISTING RENOATIONS ADD TO SELLING PRICE?

So then why would anyone list their property as-is when most of the buyers they attract will undervalue their home? Well, some people really don’t have the money, time, and energy to spare. They may be in a pinch and want to sell their home quickly and easily as possible. Whatever their reasons may be, the reality is that they lost out on thousands of dollars at closing. Exactly how much money depends on the type of renovations made by the homeowner and how desirable those renovations are to buyers in the area. It’s important to note that you don’t want to go overboard with pre-listing renovations. While adding a gilded spa bath may seem like a great idea to you, investing a fourth of your home’s value into one room will likely end up cutting into your returns.

In order to determine the extent of pre-listing renovations your home could stand to benefit from, we recommend working with an experienced agent who is familiar with your area and market. This will help you understand which renovations will produce a positive return on your investment, as a good realtor will know what buyers in the area are looking for. Even if you have a modest budget, affordable renovations still have the potential to produce significant returns.

Here at M&D Real Estate we have cultivated a team of industry experts ready to serve and work hard for you. Reach out to a local agent today to learn how much value you can add to your home with pre-listing renovations.