People love the shows on Home and Garden Television (HGTV), the ones that show you how remodeling houses for profit can be done week after week, or maybe there are a few replays in the schedule?
The HGTV shows are great at showing how dreams can come true. They provide insight into the remodeling process and more important, that it's possible to remodel houses to create homes that support your family's lifestyle and are gorgeous to look at … when staged by professional decorators.
Several of the shows which get involved in remodeling houses, give you numbers at the end of the show. You might be familiar with the format that's simple and powerful. Have you ever wondered how every project returns a profit?
Remodeling Houses for Free?
This article started when a colleague of mine said he was doing research online to learn how to remodel his bathroom for free. He also admitted he wasn't very handy, which means he won't be able to invest sweat equity in his bathroom remodel.
This was really scary to me as the odds of getting more than 100% of your investment in home improvements is very, very low (like zero percent) unless you're able to do all the work yourself, and you know how to shop for building materials at discounted prices. In face Remodeling.com's annual Cost vs Value for 2013 indicates you'll recover for a bathroom remodel:
Remodeling Houses to Maximize ROI
Digging deeper into why the discrepancy between these stories will take more time. What's important to understand are the steps every homeowner should follow to maximize your remodeling investment. Be realistic too, as today's fixtures will age over time and you can't expect the value to hold 10 or 20 years from now. The best strategy is to tackle remodeling projects like updating a bathroom to enjoy yourself, with an eye to resale value.
- Research home values in your neighborhood, focusing on the remodeling project you're planning like updating your master bath. The most important appraisal factor is the size of each space and then, the condition. A 2 car garage will get a bump in value if comparable homes have 1 car garages. A new roof in need of replacement, will cause a reduction in value while improvements over the norm for an area, won't earn credit.
- Get realistic estimates for your home's value today and after your improvements. If you're planning to spend $10,000 or more, bringing in a home appraiser is a great investment and if you don't want a written report, the cost will be lower than your standard appraisal.
| With one renovation, the appraiser told me that houses in this location and price range needed a deck, but didn't need a family room. Instead of finishing the sunroom, we stripped it down to a deck. We opened the walls between the kitchen, pantry and dining room to create a wonderful open floor plan. The advice was priceless and brought a quick sale, for a great price at the beginning of the burst housing bubble. |
- Pick projects that enhance your lifestyle and increases your home's value.
- When remodeling houses, set your budget so the home's value is consistent with comparable houses in the neighborhood.
- For each space you're renovating, pick 1 or two features as your focal points. Pick features you'll enjoy and ones that will wow prospective buyers. Spend more money on these features, and less on other items. For the house above, the focal points were an open concept kitchen, a garden window in the kitchen and a real (not faux) fireplace.
- Build your budget, setting aside ten to twenty percent contingency for hidden surprises like water or structural problems, that will need to be addressed once the project starts.
- Get estimates from remodelers and/or specialty contractors if you'd rather act as your own general contractor. You'll be able to give remodelers your focal points for the project, letting them fill in the other materials and labor.
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