Transforming your household wish list into reality is thrilling, but you’d like to be somewhat practical. Of course, you want to enjoy every last detail, but you don’t want to spend money on extravagances that have little value, especially if you think you may resell your home someday. When considering whether you should go all out, experts agree that keeping it simple will give you the best return on your investment. Learn what is considered frugal and what is frivolous.
Splurge or Scrimp
Countertops, yes. Expensive lighting, no. Stainless steel appliances, definitely. Fancy sinks and faucets; don’t go there.
These are the tricks of the trade known by contractors who work on homes. Sometimes the addition or renovation you must have has very little monetary return. And other times the upgrade that was low on your list packs a lot of financial punch.
“Oftentimes customers go into it with expectations of having to purchase high-end materials, but it’s often the quality of the workmanship and the durability of the products that give them the biggest return on their budgeted dollars,” says Cynthia Murphy, principal of Murphy’s Design in Fairfax, VA.
An example would be choosing between paying $5 or $25 for a cabinet knob. You would go with the lower-cost knob, Murphy said. “You will never recover that $25 because that’s more of a personalized choice.”
But that doesn’t mean it’s better to thoroughly scrimp. “There are ‘must haves,’” says Murphy. “You would do well from a return standpoint with quality, like well-constructed cabinets, granite or quartz counter tops and stainless steel appliances for the lion’s share of your budget.”
Those touches are ”what a new buyer is going to notice,” Murphy says. “They are not going to see other things like expensive back splashes.”
Expensive items like fancy plumbing fixtures are known as “jewelry” in the industry. These are things that are important to the current owner, but not to the potential buyer. “When you’re looking at a house, you don’t say, ‘I want to take a steam shower every day,’” Murphy says. “You say, ‘Look at how big and nice the shower is.’”
Making a house “current” or up-to- date is really the best way to make sure when you sell, you get a good return. “That should be your focus,” Murphy says.
This would entail good flooring, well-constructed cabinets, no or new wallpaper, new carpeting and a freshly painted and welcoming front door. In fact, “nothing does more than freshly painted walls and fresh, crisp trim,” Murphy says.
That’s because when people first walk into a home they take in the architecture. A fresh coat of paint really brings that out. So does a relatively inexpensive touch like a ceiling lamp.
Rooms with Returns
The focus in terms of rooms are the kitchen and master bathroom.
Kitchens need to look good because the prospective buyer will want to be able to use them right away and not have to remodel. Cabinets, counter tops and appliances “are the three pieces of the puzzle,” Murphy says. “If they are in poor shape and you don’t replace them, they will take money from the sale. Conversely, if they are in good shape, with some sprucing up, you get a big return for your investment.”
Kitchen cabinets don’t warrant as much attention, unless they are broken or the finish is worn off. “People aren’t really going to pay attention to cabinets unless they are screaming that they need work,” Murphy says.
The bathroom “has to be clean with no broken tiles and have decent cabinets and counter tops,” Murphy says. “Fixes in this room, including a new sink, or even two sinks, carry a high return for the investment.”
Sometimes it’s the very simplest touches that carry a lot of weight. “People will not pay market value for a home that is dirty,” Murphy says. “Sometimes people instead think they need to build an addition on their home and that is not usually the case.”
Another rule in real estate is build up, not out. In other words, lift the roof, don’t expand horizontally. “By building up, it is easier to manage costs of things like pipes,” Murphy says.
Another smart move is to open up a living space. This can involve opening a wall between a dining room and a kitchen, or a wall between a kitchen and a family room. “This makes the home’s space look bigger without having to spend that much,” Murphy says.
After: Now this is an inviting place, where you don’t mind spending time washing clothes. Tidying up a small space makes it more appealing, too.
Conversely, while it may be popular with the current homeowner, do not put in a pool. “You will never get back what you put in,” Murphy says.
If you want to do something with your outdoor space, put in a patio or screened porch. That would offer a nice return because it’s like another room of the house. Indeed, the outer part of the residence is just as important as the interior. The best bang for your buck last year came from a 20-gauge steel replacement entry door, according to Remodeling, a leading trade magazine. This front door is special because it is reinforced, giving a feeling of safety that can continue into the house. The door, in the mid-Atlantic region, returned about 89 percent of the cost of buying and having a professional install it, Remodeling said. Just like interiors, exterior projects that hold their value are those that cost less than major remodeling. These lower-cost touches include a garage door replacement, redoing a roof or a stone veneer installation.
“It’s about street appeal,” says Paul Pobiner, owner of Gold Coast Remodeling and Restoration in Great Neck. “When you put a new garage door in, or a manufactured stone veneer, it makes the whole property look nicer.”
A wood deck will recover about 70 percent of the investment, Pobiner says. “It’s a great value and makes the home look beautiful from the outside.”
Window replacements are also high on the list because they improve the appearance from the outside, Pobiner says. Window replacements, depending on the type, return 66 percent to 63 percent.
All in all, when going for the biggest bang for your buck, Pobiner says it’s important that you assess your needs, don’t go overboard, check out your contractor and closely follow the progress of the work. So, go ahead and plan the renovation of your dreams. Just take your time and spend sensibly.