Sell Your Home Quickly with These Bathroom and Kitchen Projects
If you are looking to sell your home, most real estate experts will advise you to make at least a few cosmetic improvements to increase the likelihood of getting offers. Certain improvements, however, are more likely to attract buyers and get you more bang for your renovation buck, and your home’s kitchen and bathrooms are great places to focus on.
Courtesy of real estate professionals at R&R Real Estate Partners, let’s look at some of the most in-demand and effective kitchen and bathroom remodeling projects, and how to calculate the rate of return on your investment.
Kitchens and baths are trendy and desirable
People spend much of their home time in their kitchens. A kitchen is often a family hub. It is the location for morning breakfast and coffee, kids’ homework, fixing dinner, and entertaining guests. Today’s buyers like clean, uncomplicated kitchens with modern-styled appliances and bright color schemes. White cabinets are favored, as well as hard surfaces for countertops such as granite and Corian. A minor kitchen remodel can return over 75 percent of your investment.
New bathrooms are also in demand. Buyers like comfortable, large showers with updated tile and soaking tubs. U.S.News notes bathroom additions can get costly, though, but it might be necessary if your family is sharing one bathroom.
In both rooms, you can boost your home’s appeal by doing a few basic upgrades to freshen up these spaces, especially if you’re on a tight home renovation budget. For example, updating the faucets and trim are inexpensive fixes that will give these rooms new life, as will upgrading your bathrooms’ shower heads. In addition, recent surveys have found that home shoppers prefer white toilets, so if yours is a different color, switching it out for a new one could be a good move. However, replacing a toilet isn’t a DIY job, so be sure to call a professional plumber to take care of this task.
Last but not least, hire someone to take a good look at your home’s gutters. The last thing you want is for your gutters to play a role in ruining the improvements you’ve made to these spaces. Backed-up gutters can cause roof damage, and the overflow can ruin any new windows you’ve installed in these rooms. Search out “gutter cleaning services near me” to find local pros, and check out websites like Angi.com that show ratings and reviews from previous customers.
Calculating profit
In order to determine how much profit you can make from a kitchen and bathroom renovation, you need to combine construction budgeting with real estate investing concepts. When you buy a home — even a home that you are not planning on renovating — your future profit is not defined solely by a future sales price. You need to factor in the expenses of acquiring the property and selling it at a later date. These are your buyer and seller closing costs.
For example, if you buy a house for $200,000, you might put $40,000 down in cash and take out a mortgage for the remaining $160,000. Your lender and other service providers such as appraisal, inspection, title insurance, and legal fees are also going to have a price. Let’s say those total $7,000. For this transaction, then, you would have invested $47,000. Your profit is not the difference between what you bought a house for and what you sell it for, but the difference between what you invest in a property and what you net after its sale. If you sell the house five years down the road for $300,000 but have real estate commissions and other fees of $20,000 and a remaining mortgage balance of $145,000, your profit is $88,000.
A similar analysis is required when determining the profit on a renovation or fixer-upper project. Simply add the total cost of the renovation into your acquisition costs — the $47,000 in the above example — then subtract the total figure from your net from the sale.
Factoring the cost of repairs against your total acquisition cost can help you determine what repairs will bring you the most profit. What matters is the total that you walk away with, but also keep in mind that some repairs are necessary just to make a home marketable.
R&R Real Estate Partners can help you sell your home quickly — or assist you in finding your new dream home! Get in touch with us by calling (505) 280-6365.
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