Yahoo Finance Best Home Improvements to Please Picky Spring Buyers
The national housing market is slowly crawling back from historic lows. Does this iffy environment change the basic "must-dos" for prepping, staging, and showing a house for sale?
Much of the same rules still apply: Cut clutter and depersonalize, scrub surfaces, replace burned-out light bulbs, plant flowers. But as the market improves, edging out the competition with home aesthetics, condition, and accessibility is increasingly important.
In these market conditions, some agents will refuse a listing that is not staged to sell.
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Improving housing stats may justify the extra elbow grease and a splurge on new drapes. The housing market is showing signs of life, although more so in some areas than others. Nationally, the trend is up. The February Pending Home Sales Index, released by the National Association of Realtors (NAR) in late March, dipped to 96.5 from 97 in January, but the index is 9.2 percent above its February 2011 reading. The index measures contracts but not closings.
NAR is hosting its National Open House campaign April 28-29. Open houses pick up in the spring, and thanks in part to mild weather for much of the nation, this spring looks to bring some of the best traffic prospects of the last few years. The NAR's Realtors Confidence Index for early April shows a market that continues to be dominated by bargain hunters and low-price bids, among other factors. But this time, a growing number of agents reported multiple bidding, pockets of low inventories, and a resurgence of buyer "interest" compared to recent months.
"The spring home buying season looks bright because of an elevated level of contract offers so far this year," said NAR Chief Economist Lawrence Yun in a statement. "If activity is sustained near present levels, existing-home sales will see their best performance in five years."
"Based on all of the factors in the current market, that's what we're expecting, with sales rising 7%-10% in 2012," Yun said.
Pictures do the talking. It was true before the recession and it remains true today. Most prospective home buyers use an online search to narrow their possibilities well in advance of ever crossing the threshold. According to a Coldwell Banker survey, 92 percent of buyers start their search online.
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Therefore, budgeting staging money for a set of high-quality photographs showcasing square footage, good flow, and important features inside and out will be money well spent. You should aim to have your house in ready-to-show shape at a moment's notice, although busy family life can make "perfect" impossible. Perfect photos, on the other hand, can do much of the work for sellers. Use a variety of online listing services to show those photos. Plus, personal or agent-driven buzz on Facebook and Twitter is common in today's market.
If your selling strategy calls for remodeling, your time and resources might best be spent in the kitchen, according to Kermit Baker, chief economist at the American Institute of Architects (AIA).
Computer stations and recharging areas for electronic devices were the kitchen features that residential architects reported as increasing the most in popularity, according to the most recent AIA Home Design Trends survey. Next on the list: family space, which continues the longstanding popularity of combining household living space with kitchen space; recycling centers; expanded pantry space; and wine storage. Adaptability and universal design are increasingly popular as aging baby boomers contemplate their future needs.
Environmental sustainability continues to be a theme. Renewable-material flooring and countertops topped the list of products increasing the most in popularity, followed by drinking-water filtration systems. Natural wood cabinets were a bit further down the popularity list, as were upper-end appliances, duplicate appliances, and natural stone countertops, according to the AIA.
Think like a buyer. The number and average size of bathrooms in the home did not fall off during the housing downturn, according to residential architects. So, giving the loo some love ahead of a sale may pay off. If you can't afford a remodel, maintenance and cleanliness will be critical. Getting in a home inspector before you list could uncover any potential plumbing, electrical, or heating/cooling surprises that may sink a prospective sale. The buyers will bring in their own inspector, but sellers should try to eliminate surprises and get a sense upfront of any potential impact on the asking price.
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The AIA also notes that home offices and outdoor living spaces are top choices for "special function" areas. So if your home has one or both, play up their features.
Sellers don't have to guess what today's buyers want (that is, on top of scoring the best deal). There are real estate resources to help sellers better understand today's market.
One place to start is with home-improvement calculators. Homegain.com's Home Sale Maximizer crunches the results from a survey of nearly 1,000 real estate professionals. It shows customized recommendations for small, mostly do-it-yourself house improvements and the value they could add to a listing, based on ZIP code. It ranks them by priority, depending on the condition of your home and what local agents feel is most important.
In Boulder, Colo., for instance, spending an average of $350 to hire a landscaper can add between $1,500 and $1,999 to the asking price, for a 400 percent return on investment. Spending $350 on electrical and plumbing repair can add $1,000 to $1,500, a 257 percent return on investment.
In parts of Birmingham, Ala., spending $150 on staging can add upwards of $1,999 to the asking price, a more than 1,000 percent return on investment. A $1,063 kitchen update could be doubled when figured into the asking price.
Not sure where to start? Here's the checklist Homegain.com uses for its calculator. Marking off most of these projects should go a long way toward positioning your property to be its most sellable:
-- Is your home clean and de-cluttered? Including closets? Buyers will open doors. Not only should they be clean, but essentially empty. Square footage matters in closets, too.
-- Make sure there's no furniture blocking windows. Let the light in and let buyers walk right up to the view. Open the curtains. Use the highest wattage light bulbs that safety allows.
-- Remove dead or dying plants inside and out. If your grass is dead, consider replacing it but allow enough time for growth. Sod may be your best option. What's the condition of outbuildings and other yard features? In many cases, no fence is better than a damaged fence.
-- Make kitchen and bathroom repairs. If you can't replace outdated fixtures, consider updates to hardware and lighting. Fix any defective plumbing or electrical.
-- Professionally clean carpets and fix any broken tiles or floorboards.
-- Fix wall gouges, holes, and scratches and only then, prime and paint. This is true of the exterior and the interior.
-- Staging should fit your budget, but it's vital. A bigger budget may allow for storage rental, then you can select rented furniture pieces if you're looking to convey a new aesthetic. Small touches can make a difference, too, including fresh flowers and setting the tables, including the patio table. It's an inexpensive and quick mood-setter than can really pay off.
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