These days, most homeowners are facing a scary reality: a rapid decline in their home’s value. According to the National Association of Realtors, median existing home prices are down 7.1% from last July — and aren’t expected to recover until well into 2009.
One way to buck the trend and boost the value of your home is to make some basic renovations. There’s no need to embark on big-ticket projects — you probably won’t recoup all of the costs anyway. Instead, seek out some inexpensive projects that will not only brighten up the place, but put a little extra cash in your pocket should you decide to sell your home. Here are five worth considering:
Cost: $60 for two gallons of Benjamin Moore interior paint — enough to paint the walls and ceiling of a 12-by-15 room.
A little paint or varnish can go a long way toward improving your home’s value. One fresh coat (along with a little sanding and caulking) wipes out the scuffs, chips, cracks and other damage that clearly convey wear and tear. Make your first priority the front door, where everyone from visitors to potential buyers lingers. “You’re standing on the front porch and you have a good 15, 20 seconds just to look,” says David Lupberger, home improvement expert with ServiceMagic.com, a Golden, Colo.-based contractor marketplace. Inside, don’t forget to freshen up the baseboards, doors and ceilings after you tackle the walls.
Just remember to stick to neutral colors if you’re thinking of selling sometime soon, advises Lupberger. Buyers might not share your appreciation for the eye-popping combo of Fireball Orange and Traffic Light Green in the living room.
2) Basic Maintenance
Cost: $250 for a home inspection, including walk-through and report of suggested fixes.
“You have to be careful with remodeling because you can spend money in the wrong place and not get it all back,” says Lyle Martin, co-founder of Assist-2-Sell, a Reno, Nev.-based real estate brokerage. A common mistake: making aesthetic upgrades while ignoring basic maintenance. New bathroom tiles mean nothing if the plumbing is faulty or the underlying wall has dry rot.
If you don’t address these problems before putting your home on the market, it’ll cost you. Buyers traditionally negotiate a $2 discount for every $1 in damage that turns up in a home inspection, according to home inspection service HouseMaster.
Aim to complete a few small maintenance projects each year, like fixing that creaky floorboard or replacing a cracked light switch plate, advises Martin. Not sure where to start? Hire a home inspector to point out which areas would be problematic were your home on the market.
3) Energy-Efficiency Upgrades
Cost: $500 to replace your old clothes washer with an Energy-Star certified Frigidaire washer (including a $50 utility-provided rebate and an estimated $50 in energy savings the first year).
Energy-efficiency projects such as installing Energy-Star windows or swapping for a high-efficiency boiler are one of the few upgrades that hold their value in a down market. Not only will such improvements cut your energy bills, but they’ll also be more attractive to buyers who are hunting for more earth-friendly homes. “Homeowners can show buyers their utility bills as documentation of the effects of those energy-efficiency improvements,” says Rozanne Weissman, a spokeswoman for the Alliance to Save Energy. “With energy prices so high, it makes a big difference.”
Look for incentives and rebates through your utility providers and state and local governments. And don’t forget about federal tax credits. Both the House and Senate have given tentative approval to a two-year extension of the energy-efficiency tax credits from the Energy Policy Act of 2005, which offered a credit of up to $500 for select projects completed in 2006 and 2007. Look to the Tax Incentives Assistance Project to refresh your memory on what criteria projects must meet to qualify.
4) Install New Fixtures
Cost: $86 for an American Standard faucet, 10 drawer pulls and 10 knobs.
Giving a room a more modern look requires little more than a screwdriver and some new fixtures. “New hardware can completely freshen a house,” says Amy Matthews, host of DIY Network‘s “Sweat Equity.” “Things that are outdated are things that buyers would turn their noses up at.” As far as fixes go, it’s dirt cheap. New drawer handles or knobs can be had for as little as $2 each. There are also plenty of options out there for personalizing your space. Home Depot lists almost 900 kitchen and bathroom faucets priced below $50. You might also try swapping out ceiling-mount light fixtures or doorknobs.
Cost: $200 for five each of dogwood, forsythia and red-flowering butterfly shrubs, plus $100 for enough mulch to cover 200 square feet of planting beds.
“A good first impression is crucial,” says Jennifer Michaels, senior vice president for FSBO.com, a for-sale-by-owner listing site. Your carefully groomed landscaping — or, in contrast, weed-overgrown jungle — is one of the first things a potential buyer notices. But enhancing curb appeal is also something every seller does. You’ll score more points with a yard that was obviously fixed up long before you listed your property.
Savings can be had as well, as long as you plant wisely. Drought-resistant shrubs require less water, while perennials won’t require repeat plant purchases in coming years. Leafy deciduous trees shade your home from the hot summer sun, and allow maximum heat transfer inside during cold winters.