Kiki Interiors - Decor and Staging

Monday, May 18, 2009

Help me spend my reno money!!

When it comes to home renovations, some money is better spent. The money invested in improving your home will not always translate into an equivalent return in the selling price of your home. However, with planning it is possible to both increase the saleability of your home and even profit from your home renovations. Don't forget about the new home renovation tax credit ( help anyone looking at renovating their homes. Check out the above link for more information.

Renovations do not have to be extensive or expensive to earn a high rate of return. In fact, one of the cheapest and simplest improvements yields one of the highest paybacks - paint! A fresh coat of paint on interior walls returns an average 73 percent payback. So, a $1,500 paint job could be expected to increase a home's selling price by $2,625 (a $1,125 profit).

To maximize saleability ensure that your new decor is modern and tasteful. Choose shades of white and tame versions of popular colours (look at new show homes for color ideas). Steer away from too many personal touches and custom work if you plan to re-sell. It is unlikely that your investment will be recouped and it may prevent the quick sale of your home. Also, try to keep renovations in harmony with the fashion of your neighbourhood. A fresh paint job is one way to increase your profit and the number of showings but you also want to make sure your home is clean, decluttered and organized. Some home improvements will make your home sell faster but will not necessarily increase your profit. An example of such an improvement is installing a granite counter top. A granite counter top will be expected at a higher purchase point but your basic town home will not really benefit from such a cosmetic update.

So where should you invest when it comes to home renovations? The kitchen and bathroom are key areas to focus your renovation attentions. With average paybacks of 72 and 68 percent respectively, new fixtures, cabinets and tiles could be well worth the money and/or time and effort. The AIC's ( Appraisal Institute of Canada ) study highlighted the top ten renovations and the average rate of return:

1 -- Interior painting and decor - 73%
2 -- Kitchen renovation - 72%
3 -- Bathroom renovation - 68%
4 -- Exterior paint - 65%
5 -- Flooring upgrades - 62%
6 -- Window/door replacement - 57%
7 -- Main floor family room addition - 51%
8 -- Fireplace addition - 50%
9 -- Basement renovation - 49%
10 -- Furnace/heating system replacement - 48%

One area that tells the purchaser a lot about the home and seller is maintenance. If a seller wants top dollar for there home small repairs and basic maintenance must be attended to. Agents on the Bennett Real Estate Pros ( team have had buyers reject a home because of something minor such as peeling paint on a deck. The potential purchasers felt if the obvious was not attended to, other problems were hidden and not attended to. In this market, potential buyers are educated and are looking for something specific. If you are selling make sure your home is picture perfect.

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