Buying real estate is an investment that can appreciate over time, especially with proper updating. A house that has been lived in for several years will undoubtedly have wear and tear and will depreciate to some extent. Before selling your lived-in property, you want to make sure that your home appeals to potential buyers. Even though your home may not sell for what you paid for it, several pursuits can ensure you see a significant ROI.
An ROI (return on investment) is an evaluation of the profitability or efficiency of an investment or a comparison of the efficiency of several investments. Concerning real estate, several factors come into play when figuring out the ROI of a property. Repairs and maintenance costs, painting, landscaping, advertising, appraisals, and commission to the realtor must be accounted for. Additionally, the leverage, or money borrowed with interest to make the initial investment, should be considered.
When purchasing a property, financing terms can greatly impact the overall cost of the investment. They say “one man’s trash is another man’s treasure,” and real estate ROI is no different. What some real estate investors consider a “good” ROI, others may find unacceptable. These results vary based on risk tolerance. Those who are risk-takers do so in hopes that the payoff will result in a major ROI. Conversely, risk-averse people will settle for lower ROIs in exchange for a reliable result. Your prerogative will be a crucial element here.
It must be noted that ROI does not equal profit. A home must be sold before ROI cash profits are realized. Properties often do not sell at market value, and a house may sell for less than the original asking price, resulting in a lower final ROI on the house. There are several efforts to undergo that will not break the bank but will reap significant outcomes. Below are some beneficial upgrades to uptake to ensure you see a favorable ROI.
The gate, the garden, and the home exterior are the first areas house hunters will see when visiting your home. First impressions are everything, so be sure to spruce up your front yard to present a fresh and appealing property. According to FortuneBuilders, the average cost of a landscaping update is $4,900, with an ROI of 100 percent. Curb appeal sells homes, so you want to ensure you present a manicured lawn, colorful flowers, and a clean and organized garden space. Here are some great ideas to boost your curb appeal, and ultimately, your ROI:
Once you move past the landscaping aspect, you will want a lovely outdoor living space to add a substantial amount of perceived value to the home. A patio area is an excellent place for dinners on warm summer nights and post-work cocktails. The sheer liveability of a sleek and decked-out porch is a huge selling point for buyers, especially when we’re talking about Santa Monica or Venice real estate. Beachside breezes and Socal vibes make patios worth their weight in gold.
Assuming you don’t already have a patio and there’s ample space for it, adding one is highly beneficial when selling your property and delivering a more considerable ROI. The average cost to add a deck is $11,000, with an ROI of 90.3%. If you already have a patio that just needs some tidying up, you’ll spend less and still reap a substantial reward. Enhance curb appeal, make the property homier, and draw viable home buyers with these tips:
Gutting your kitchen and starting to build from scratch will result in a 91% ROI on average, and believe it or not, doing a minor remodel instead will yield better results! Upgrading your kitchen instead of starting anew will accrue a 98.5% ROI on average and cost roughly $15,000. This is excellent news for your pocketbook and calendar, giving you more time to worry about other home selling tasks. See these guidelines to achieve a big return on a minor kitchen upgrade:
Bathrooms and kitchens are two essential rooms to address when selling a house. The largest ROI comes with a minor bathroom remodel, averaging at 102 percent! This will cost you $10,500 on average, with a return of $10,700. Just like with the kitchen, there’s no need to begin with a blank slate; you just need to make some calculated changes. The minor bathroom remodel ROI is considerable, so investing in bathroom detailing is better than undertaking smaller projects in multiple rooms. Try these changes for a significant ROI:
Even more critical than bathroom and kitchen renovations are basic home improvements. You want to ensure the basic home structure is sound before undertaking the massive venture of home selling. Imagine remodeling the bathroom while your 35-year-old roof shingles are hanging by a thread. It is of utmost importance to handle structural issues before moving on to luxuries like kitchen cabinetry and showerheads. Consider securing these elements before moving on to fun design changes:
Before undertaking these home improvement pursuits, speak will a qualified realtor. Your agent will know what you need to do to make your home more marketable. Their housing market insight and real estate savvy are pertinent to your decision-making.
Are you looking to boost your ROI on your Pacific Palisades real estate? With a professional and knowledgeable Santa Monica realtor like Tracey Hennessey by your side, you will indeed see a major ROI on your Los Angeles home.