Renovating or improving something too much sounds like an oxymoron, however when it comes to attracting a buyer and generating a return on investment, it is possible.
The decisions you make may be best for you and your family, but it is crucial to consider the mindset of potential buyers.
Here are five common renovation mistakes that may decrease your home value:
1. Over improvement: Your home should be similar to other homes in the neighborhood. If your home costs much more than other homes in the neighborhood, potential buyers may choose that the updates you made do not outweigh the increased cost.
2. Over personalization: You may love bright paint, built-ins, and elaborate tiles but the potential buyer may see changing it as too much of a hassle. You want buyers to be able to picture themselves living in the home so it is helpful to have a neutral design aesthetic when you show your home.
3. Inconsistency: It is better to spend smaller amounts on many projects than spend a large amount of money on one project while neglecting other parts of the home. Instead of spending upwards of $30,000 installing a pool while keeping old and outdated appliances, it is a wiser decision to update the appliances.
4. Removing a wall: It may seem as though knocking down a wall between two small rooms to make one larger room is a no brainer but having more rooms is almost always better when it comes to increasing the value of your home. Your family may be smaller than the potential buyers and, for them, it may be better to have more rooms regardless of their size. Removing bedrooms can also decrease the value of your home. Turn an extra bedroom into an office or gym while you are living there, but switch it back to a bedroom when you are getting ready to sell.
5. Functional Obsolescence: Make sure that your renovations make sense. For example, potential buyers will probably not want to have the only way to enter one bedroom be to go through another bedroom. Another example would be turning a garage into a guest house. Although having a guest house might be better for your family, many families would prioritize having a garage.
Remember these mistakes when you are choosing renovation projects around your home. What seems like a good idea might not actually lead to a return on investment or, worse, may detract someone from buying your home.