When it comes to luxury improvements, it may be wiser to go conservative.
The Swimming Pool Who wouldn’t pay extra for a home with a gorgeous in-ground pool?
Actually, most people won’t! Experts across the real estate industry agree that pools almost never add to a home’s value, and sometimes they actually decrease home prices.
First, the numbers: According to Fixr.com, the average in-ground pool installation costs $21,919. You’ll need to invest at least $400 and likely a whole lot more into cleaning supplies, ladders and other pool accessories. There are also heating costs to consider. You can spend around $5,000 dollars on a solar heater, or you can deal with an increase in your home’s energy bills. Finally, there are the monthly costs of pool chemicals, which average out to around $95 each month for in-ground pool owners.
The routine costs like heating, cleaning products and pool chemicals are enough to scare away many homebuyers, but there’s more to it than that.
Pools require a lot of maintenance, both yearly and monthly. Many would-be homeowners see pools as a massive maintenance headache rather than a luxury.
Families with young children may steer clear of homes with pools because of the potential dangers.
Speaking of danger, pools are considered an attractive nuisance. Plenty of homeowners will turn up their noses because they don’t want to pay the exorbitant homeowner’s insurance or risk a lawsuit.
Further, the value your pool adds to your home is largely region-dependent. For instance, homes with pools in Florida or Arizona will be an easier sell because people can enjoy them most of the year. In cold climates, pools are not attractive at all because homeowners know that they’ll only get three or four months of use per year out of them.
It’s always a good idea to remodel a room that hasn’t seen attention in decades. Research suggests, however, that you’ll lose big on additions and high-end remodels. For instance, definitely replace the 30-year-old carpet n the master bedroom, and consider a coat of fresh paint. Don’t plan on adding a new master bedroom solely on the assumption that it will increase the value of your home. Remodeling Magazine says that this upgrade costs homeowners $224,989 on average, but it will only add 56 percent of the upgrade’s cost — to the value of your home.
Kitchens are another losing proposition. Make sure your kitchen is current, but don’t pull out all the stops by installing a kitchen that a master chef would envy. The average kitchen remodel costs $109,935, but you’ll only see 63.6 percent, or $69,973 back.
Home offices are another popular remodel, but you have to remember that not every prospective homeowner wants or needs a high-tech home office. Even though this particular remodel is inexpensive at $28,000 on average, you’ll see a pitiful 48.9 percent or $13,697 return on your investment. Get ideas here.
A minor amount of landscaping is one of the best ways to increase your home’s value, especially if it adds a touch of much-needed curb appeal. That means you can safely do some inexpensive things, like:
Adding trees and shrubs to your landscape.
Invest in a healthy, weed-free lawn.
Using native plants to spice up your perennial beds.
These things can net you as much as 28 percent more on your sale price, and they can reduce the amount of time your home sits on the market by 10 percent to 15 percent.
The problem is when you take your landscaping too far. Spending thousands to turn your backyard into a lush tropical paradise complete with water features will not only lose you money in the end, but much like a pool, it may drive away potential buyers. You’ll be setting them up for maintenance headaches while effectively placing your home in a niche market.
Investing thousands in decks and fanciful outdoor construction isn’t the wisest idea, either. Outdoor living spaces are great if you and your family will put them to good use, but you won’t recover all of the money you spent on the installation. Remodeling Magazine says that you can expect to pay $15,437 to install a wood deck, but you’ll only see 74.3 percent — or $11,476 — back.
In summary: When it comes to luxury improvements, additions and upscale remodels, don’t do it for the potential returns because it’s unlikely that you’ll get all of your money back. Instead, make major improvements because you plan to enjoy them for many years. When it’s time to sell, your money is better spent on small repairs, minor upgrades and inexpensive aesthetic improvements. See ideas for home improvements here.
If you would like to discuss home improvements and how your project might impact your home value, give me a call at 712-541-5118.