Selling your home is more than just a financial transaction; it’s also an emotional experience. It can be difficult to put your personal feelings aside while nitpicking strangers walk through your home and show no appreciation for all the work you’ve put into it.
But if you want an honest opinion of what your home is worth than you need the impartial opinion of an appraiser. The August issue of Money Magazine had an interesting article by Alison Rogers called “Think Like an Appraiser” which discussed how appraisers will factor in various aspects of your home. I’ll share a few interesting tidbits from the article.
Curb appeal is vital. If your lawn is overgrown and the yard is a mess, many people won’t even bother stopping to look at the inside. Hiring a professional landscaper to clean it up and make it more presentable will cost a bit out of your pocket, but you should get most of it back.
A brand new roof won’t add any value. People expect a roof to work when they buy a home, just like they expect the appliances to work and the toilets to flush. A new roof or water heater (mine broke three months before we put our house on the market) won’t add any real value to your house, but they do make nice selling points and could help close a sale.
Finishing a basement and adding a half bath will add some value, but not as much as increasing the living space on the ground floor.
The nearby market will naturally have a huge impact on your home’s value, but it’s the closing price that really matters and not the asking price. Your neighbor with the same exact floor plan as you may have just listed his home for $450,000, but that means nothing unless someone is willing to pay his asking price. If he settles for $350,000 you can forget about asking for a half million.
Expensive remodels can have a huge impact, both positive and negative. Timeless improvements such as hardwood floors or new kitchen cabinets will increase your home’s value. But generally any remodeling that is considered too customized or personalized will have a negative impact. An expensive built-in entertainment center with numerous bookshelves will be assessed at the cost of ripping them out.