Want to know about strategies that will increase a home’s value over it’s neighbors at a relatively small increase in cost? Consider things that are a bit just outside of the norm.
What home buyers, sellers and investors (who are a bit of both) have in common is evaluating what Realtors refer to as the home’s ‘move-in quality’. Realtors will tell you that most home buyers prefer something that they can move right into with the least amount of disruption. At a minimum, they want the home’s ‘bones’ or floor plan and the way things flow from room to room to be just right. From the home buyer’s perspective, everything else – like the kitchen cabinets or bathroom sinks – can be changed at some point in the future.
Of course the investors perspective is price first, but they too recognize that the basic structure has to be right or they’ll have a hard time finding a renter or flipping the property to a new buyer at a nice profit. They also understand that in a market with few buyers, they need to make their property a bit unique in order to separate it from the competition and increase their chances of making a decent profit.
why would a qualified home buyer select one house to buy over any of the others?
And of course, home sellers readily recognize they too must answer the question – why would a qualified home buyer select one house to buy over any of the others in that same area – especially tract homes with an identical floor plan? The answer here again is to make it stand out a bit by creating something memorable. But someone selling a home is probably not looking at investing any more dollars than necessary so an ‘improvement’ just prior to sale doesn’t make a lot of sense; does it?
Here’s an example where that could work. Before a home sells, it will undergo a termite and dry rot inspection from a licensed professional. Many times, problems are found in exterior wood structures like the lattice patio covers that adorn almost every suburban back or side yard at one point in it’s existence. A professional Realtor in Orange County California told me of a home he had listed that required over 90% of the lattice cover to be removed, replaced and repainted. As Matt Trudell of Coldwell Banker in Mission Viejo explained, when the dollars have been spent and the repairs completed, the home seller would simply be bringing the house up to the status quo of the neighborhood and the competition – there would be no return on the dollars the seller had to invest as what was done was maintenance required to make a sale.
But had the seller opted to invest the dollars in a different kind of cover, he could have not only made his home stand out and attract needed attention, but he would have increased it’s value significantly over the cookie-cutter competition. The change? Creating an outside entertainment area that could be used year-round by using a solid roof instead of 2x2s. In the photo accompanying this article, I had replaced the normal 2×2 lattice with a solid covered roof. I also added several features that really made it blend into the house by installing cedar planks over open beams for the ceiling, adding a couple of built-in fans for cooling (you can also add gas lines for heaters), stuccoed the support pillars to tie it into the house and then added a few other decorative features. I also removed the existing 1970’s style slider glass door and picture window and replaced them with a total of six french doors so when it’s time to entertain (come rain or shine), the host can open all the doors and essentially, increase the size of the living or great room by the square footage now under cover on the patio.
Cost differential was more than made up for in the increased value of the property
Yes, a covered patio such as the one I built costs more than replacing a bunch of 2x2s and wood posts. But that cost differential was more than made up for in the increased value of the property when it goes to sale and just as importantly, helped separate that house from the pack. It becomes of even more value for a home buyer who not only appreciates the increased value of the improvement, but also gets the advantages of a much larger living space with a mild climate, means pretty-much year around enjoyment (I built quite a few of these on new homes in Arizona). Even on those so-called rare occasions when it rains in Southern California and the neighbors are trapped inside their homes, this homeowner can sit outside and watch the ‘back side of a waterfall’ as it runs off their somewhat different patio cover.