The big question before listing your home for sale is “Should I make upgrades and improvements before listing this home?” The answer comes from these three distinctive factors which combined will give the best answer for your specific home:

1. What is the condition of the competition?
2. What is the state of the real estate market you’re stepping into?  
3. What is the likelihood you will return on your investment?

Consulting with your REALTOR® to gain some guidance and request a market analysis for homes in your neighborhood will give you insights to aid in making the best choice for your situation.

Let’s take a deeper look at each of the above questions.

The Condition of Available Homes

It worth your time to learn what’s happening with the neighborhood homes currently listed for sale. These homes are potentially competing against your home for a buyer’s attention. Before taking on a sizable remodeling project or making repairs beyond general maintenance ask your REALTOR® what is trending on buyer’s wish lists. What specifically are buyers asking for in the homes they visiting? How many wish list boxes would your home fulfill for these buyers?

Buyers may be seeking a home to fix and personalize themselves or they may want a home already that’s move-in ready. If your home compares well to other listings the only upgrade you may need to consider is a fresh coat of paint in a neutral color on the walls. If your home ranks much lower in comparison be prepared to either list it considerably lower to attract a buyer’s attention or to step up the upgrades to move you closer to what buyers are seeking.

In general, fixer-upper buyers will discount the price offered to allow for needed repairs and for the inconvenience of having to make these repairs shortly after purchasing the home. The majority of buyers want a home that is move-in ready. If you choose not to make any repairs or improvements this limits the number of buyers who may be interested in your home especially if it comes to deciding between a turn-key or one needing fixes.

Your Checklist for Minimum-Improvements

Use this checklist as a guide for necessary fixes to make before listing your home.

• Patch any holes and cracks in the walls and ceilings
• Fix all broken appliances and HVAC systems
• Repair leaky faucets
• Replace worn or stained carpet
• Repaint scuffed walls or dark colors with a neutral color. Neutral doesn’t have to be white. Your REALTOR® can guide you on the numerous shades considered neutral.
• Replace any broken windows
• Repair the roof
• Update any outdated light fixtures and ceiling fans
• Update outdated drapes and window coverings
• Fix any code violations

Is it a Seller’s or Buyer’s Market?

You’ve probably heard of the market referred to as a seller’s market or a buyer’s market. Here’s what each actually means: 

The seller’s market is described as when the increase in home inventory drives up the prices of homes. In general, there are four factors that may drive demand:

• Economic factors which brings new residents to an area in need of housing—pushing prices up before inventory can be built
• Downward trending interest rates which improves affordability—especially among first-time buyers
• A short-term spike in interest rates can be the nudge for buyers on the fence about whether to buy now or wait
• Fewer homes on the market—the lower inventory because of lack of new construction means prices on existing homes may go up

The buyer’s market is described as reduced demand and declining home prices. In general, there are five factors impacting this type of demand:

• An economic disruption such as a large employer shut-down or layoff causing people to leave the area following new job opportunities
• Higher trending interest rates—this reduces the amount of money people hope to borrow to be lower and home prices typically drop to match the level of demand, allowing buyers to find better deals
• Short-term decrease in interest rates can give borrowers a slight edge in their purchasing power until the interest rates change
• Increased home inventory such as a new subdivision will put downward pressure on the rates of nearby older homes
• Natural disasters can negatively influence property values in the neighborhoods where the disruptions occurred

If the market is neutral it means there is little change between a seller or buyer market. Both sides are fairly evenly matched.

Maximizing the Return on Your Investment

Remember the top finishes such as granite or quartz aren’t required and won’t be noticed if you have a leaky faucet or stained sink. The dripping sound from a sink can’t be ignored and will lead buyers to have concern about other lurking fixes.

If any planned upgrades won’t return on your investment, rethink this upgrade. For instance, adding a yard sprinkler system when the bathroom or kitchen is where you should concentrate won’t lead buyers to say “yes” to a property. A minor kitchen remodel to improve storage and function or adding a double sink vanity in the bathroom will help buyers see your home meeting their daily living needs. Both the kitchen and bath are essential rooms in any house. If you have a limited budget for upgrades look to either one of these rooms first.

Bottom line, will the upgrades increase the value of the home by more than what you have spent to make the improvement? Click here to request a market analysis and schedule an appointment to discuss your needs.

Hillary Gaynor has real estate listings spanning the New Hampshire Seacoast and Southern Maine area. The Bean Group has listings in Maine, New Hampshire, Vermont, and Massachusetts. Hillary is happy to refer anyone outside her area to a trusted agent in her extensive network. Helping you find a good neighborhood is what we do. We pride ourselves in knowing the communities and guiding buyers towards their future homes. Schedule an appointment to get started.