The Resale Factor: Maintaining Your House's Marketability
- posted 1.7.2013
- Brian Brice
- Home Life
In 2011, an Action Comics comic book sold for $2.16 million. A different copy of that same book previously sold for $1.5 million. Why the disparity in figures? Condition – one was in better shape than the other. In the world of collectibles there is arguably no greater determinant.
So, what does this have to do with your home? Your home is essentially a collectible, and its value is largely affected by its condition. As a homeowner, you want to take necessary steps to keep your home well-maintained. Here are some ideas on keeping your home in tip-top shape.
Set a Budget
There is no hard and fast rule when it comes to budgeting for home maintenance, but the following are commonly used:
One way to budget for maintenance is to set aside 1% (some suggestions will even bump it up to 4%) of the purchase price of your home annually. Say you bought your home for $500,000 — you'd put $5,000 a year (or around $415 a month) into a “maintenance kitty”.
A similar approach is to budget $1 annually for every square foot of your home. If you own a 3,000 square foot home you'd set aside $3,000 a year for repairs.
Both are simple, but neither is much of a science. Critics point to variables like market value and material costs. If you bought your home during a slow market then 1% of your abnormally low purchase price might not appropriately cover maintenance costs. And the material and labor costs for a 3,000 square foot home in one area may be significantly cheaper or more expensive than that of a house the same size in another area. Still, even with these imperfections either option can be a decent starting point.
Know What to Upgrade
While the majority of improvements you make to your house will add value to it, some features have been shown to bring more interest and a greater return on investment when a home is put on the market.
Think of any sitcom you've ever seen — they pretty much all feature a kitchen. It's the heart of the house. And according to several surveys it's the area that yields the best return on remodeling.
If you think about it, you don't really use furniture or appliances to modify a bathroom which means in order to change it you have to change actual parts within it — paint, cabinetry, hardware. Your average buyer isn't looking for a DIY project.
You might think all windows are the same, but believe it or not technology has come a long way – even for sheets of glass. Modern windows conserve energy, provide better insulation from sound, look nicer and can save you money on utility bills.
The sight of a disheveled roof can raise red flags and send potential buyers heading in the opposite direction. Roof repair can be expensive and presents concerns for other problems like water damage or mold. A recently repaired roof can ease a buyer's mind.
It's literally the first thing people see when coming to your home. A well-manicured yard goes beyond just aesthetics – plants and especially trees can provide cover from the sun and a natural play environment for children. This can also appeal to pet owners.
Whether you intend to sell at some point or plan on sticking it out for the long haul, maintaining your home during the time you own it will undoubtedly prove to be beneficial.