Location is made up of many factors. We are all aware of the positive ones, such as schools, appearance, walk-ability and so on. Let’s look at some of the negative things that could affect the desirability of a property and its location, and possibly prevent you from selling a property quickly.
A couple of negative indicators to watch out for:
1) A large number of foreclosures can bring down the value of a neighborhood very quickly.
2) Is the neighborhood on the upward or downward swing? You can often discern this by driving up and down the streets. The best time is in the middle of a work day. A neighborhood should be quiet in the middle of a work day; most people should be at work. If that’s not the case, I stay away.
3) Crime rates can also affect a neighborhood. There are many ways to research local crime rates. One tip, go to the local store at an odd hour and see how you feel about it. Sounds simple but it works.
The second biggest key is the condition of the property. A study done from Coldwell Banker found that 87 percent of first-time buyers don’t want to buy a home that requires them to do a lot of work. They want the home in “move in” condition.
According to an article in RISMedia, when a contractor’s work totals $40,000, that increases the asking price by $100,000. This is a very broad statement but the point I’m trying to make is that putting a little effort, money, and TLC can add up.
So what do you fix for maximum return? Here are a few ideas:
- Repairing things like leaky pipes & broken windows are a must
- Replacing a roof (with a guarantee) increases the listing price
- A new driveway can really help with curb appeal
- Hardscape – walls, decks, arbors, fountains etc… Consider these carefully, they can be expensive and not add a lot of value
- Softscape – the plants – consider a color theme then use it along with a layering effect of various plants to create a custom look. It’s also nice to use seasonal plants
- Repair fences and gates
- Clean the carpets if in VERY good condition or replace
- Eliminate clutter and trash
- Paint – keep it neutral – bold or off beat colors can scare buyers off
- Refresh hardware – this can be an inexpensive way to give a new look
It’s also very important to stay within the neighborhood standards. An eight by eight closet with built-ins won’t get you the ROI (return on investment) in a neighborhood that has small closets.
So what is the ROI for fix up projects? The list below is compiled from several published surveys and shows typical payback for some popular remodeling projects:
- Kitchen remodeling – 90%
- Add a bathroom – 90%
- Bathroom remodeling – 80%
- Install central heating – 90%
- Install central air – 75%
- Add a deck – 70%
- Replace windows – 70%
- Add a room – 55%
- Build a pool – 45%
- Finish a basement – 40%
It is a fine balance, not to over improve but to make the property desirable so that it will move quickly.