5 Ways You Can Accidentally Lower Your Home’s Resale Value
A home is the biggest purchase most people will ever make, and homeowners usually want to do whatever they can to protect the resale value of their property. After all, Americans see their homes not just as a place to lay their heads and raise a family, but also as way to grow their wealth. One-third of people in the United States say real estate is actually a better long-term investment than stocks, bonds, or precious metals, according to a Gallup poll.
Experts might disagree about whether a home is really a good investment, but it’s still a major asset, even if it won’t make you rich. Although home prices are on the rise, homeowners still need to take steps to preserve or enhance their property’s value. Aside from general upkeep, homeowners can make smart upgrades to increase a property’s resale value while avoiding renovation mistakes that lower their home’s selling price, such as custom upgrades that appeal to a small sliver of buyers, removing bedrooms, or making a house too fancy for the neighborhood.
“Projects that take a home significantly beyond community norms are often not worth the cost when the owner sells the home. If the improvements don’t match what’s standard in a community, they’ll be considered excessive,” Scott Robinson, president of the Appraisal Institute, said.
Those big renovation no-no’s aren’t the only ways to sink your value of your home. Small mistakes can also deter would-be buyers and generate less generous offers when you’re trying to sell. Weird paint colors, shabby front yards, dated appliances, and even messy, cluttered rooms can all mean you’ll get less out of your house. Before you put your home on the market, make sure you’re not making these five mistakes that can accidentally lower your home’s resale value.
1. Not fixing obvious damage
You may not see the stains, nicks, and scratches in your home, but you can bet buyers will. Fixing minor but obvious damage is a no-brainer and will make it easier to sell your house for top dollar, according to real estate website Trulia. Spending just a few hundred dollars touching up chipped paint, repairing leaky faucets, and removing carpet stains could mean the difference between a low-ball offer and a buyer coming in at full asking price.
“Your home has to look better on the day of the open house than it’s ever looked before,” Steve Clark, a Los Angeles real estate professional, told Consumer Reports. “If the back door is covered in scratch marks from the dog, you have to fix that.”
2. Removing mature trees
Mature trees can increase your home’s resale value by 10%, according to the U.S. Forest Service. Not only are they aesthetically pleasing, but well-placed trees can lower energy bills and provide coveted privacy. Ripping out full-grown trees could be a turnoff to potential buyers, especially since they’re not easily or quickly replaced.
Your oaks and elms need to be planted in the right place and be well maintained if you want them to enhance, not detract, from your home’s resale value, though. Trees that are planted too close to the house can be a fire hazard, extensive root systems can damage foundations, and diseased or damaged trees can be hazardous, according to the Appraisal Institute.
3. Converting the garage
Americans have come to love their garages. In 1971, only 39% of new homes came with a two-car garage, and 43% of just-built single-family houses either had no garage or just had a carport. Today, 85% of new homes have either a two- or three-car garage. While many people aren’t actually using their garage to park (a quarter of Americans say the structure is too cluttered to fit their car), you convert it into a bedroom or den at your own peril.
Garage conversions are tricky, according to Realty Times. You might get square footage, but the space may be poorly insulated and not look very nice. When it comes time to sell, some buyers will balk at the lack of covered parking space, especially if you live in a cold or rainy climate or in an area where parking is at a premium.
4. Quirky paint colors
You might love the deep blue walls in your dining room or bright green exterior paint, but these design flourishes can hurt your home’s resale value. Neutral shades tend to be more appealing to buyers, according to a recent survey by Zillow Digs, though you don’t have to eschew color entirely. Sage green and wheat yellow rooms actually helped boost a home’s selling price, the survey found.
“[T]o get the biggest bang for your buck, stick with colors that have mass appeal so you attract as many potential buyers to your listing as possible,” Svenja Gudell, Zillow chief economist, said in a statement. “Warm neutrals like yellow or light gray are stylish and clean, signaling that the home is well cared for, or that previous owners had an eye for design that may translate to other areas within the house.”
5. Shoddy staging
Staging your home can help increase its resale value, according to a survey by the National Association of Realtors. Home staging – or making a property more appealing to buyers by decluttering, rearranging furniture, and using other tricks to show off its best features – can increase a property’s value by anywhere from 1% to 10%, according to nearly half of experts surveyed. The living room and kitchen were the most important rooms to stage, they said.
On the other hand, lackluster staging can hurt a home’s value. “At a minimum, homeowners should conduct a thorough cleaning, haul out clutter, make sure the home is well-lit and fix any major aesthetic issues,” Chris Polychron, president of NAR and an executive broker with 1st Choice Realty in Hot Springs, Arkansas, said in statement. Small steps like putting away knickknacks and family photos, removing or replacing furniture that’s too big or too dark, and even putting out new, clean towels in the bathroom can all make your home more appealing to buyers, according to experts interviewed by Vogue.
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