3 bad choices that can kill your home's value
Iris Price | Improvement Center Columnist | June 3, 2015
When you buy a house, are you already thinking about the day you sell it and its potential value?
Unless you're a house-flipper, that's probably the furthest thing from your mind. You're planning to stay and make it your own. According to a 2014 National Association of Realtors® (NAR) report, Gen Y homebuyers plan to stay put at least 10 years, while Gen X and the Silent Generation expect to be in their homes for 15 years. Boomers look forward to living another 20 years in the same house.
Regardless of generational expectations, when you own a house, you want what you want, so why think about home value until you're ready to sell?
Well, for one, the report concedes that actual home ownership duration often proves shorter than expected -- 13 years, according to National Association of Home Builders (NAHB) calculations. Further, NAR statistics on the characteristics of purchased homes show that while each generation of buyers' preferences differ, 84 percent of all homebuyers opt for previously owned homes. Of those, 30 percent buy on the basis of best price and 28 percent go for best value. So while you may not know exactly what the buyers who ultimately purchase your home will desire, you can be fairly certain they'll want the most bang for their buck.
As a prospective or current homeowner, here are three ways you could inadvertently devalue your home, which probably represents the biggest investment of your lifetime:
If you are buying your home now, you're looking for a location that suits your needs, but at the same time you can't always anticipate changes to the surrounding area during 10 or more years tenure in your home. Neighbors move; traffic worsens; buildings go up that block your view; a new job creates a longer commute.
Those are scenarios over which you have little or no control. It almost goes without saying that you would not deliberately choose a poor location on purpose, but budget constraints can push you toward one that's less than your ideal.
If you're in the market for a new home now, you might avoid some unpleasant surprises by researching future land use for your locale. It may discourage you to find out that five or 10 years from now a freeway is planned that will replace the current meadow view. On the other hand, if located a couple of miles away instead of across the street, a new freeway might be a great selling point some day.
If you're buying, these location factors and others can affect the value of your future home:
- Accessibility to transportation
- Community amenities such as walking, biking, hiking trails
- Proximity of shops and services such as hospitals, fire department
- Reputation and distance of schools
- Noise levels from nearby businesses, flight patterns, major thoroughfares
While negative factors beyond your influence can threaten to devalue your home, you can boost your home's value in other ways. Double-pane windows and additional insulation, for example, can cut down on outside noise. Upgrading "hot ticket" rooms like kitchens and bathrooms may also help outweigh a less-than-perfect location.
Lack of maintenance
Nothing turns off potential buyers as much as a poorly maintained home. They know that once they take the keys from your hand, they'll be paying big bucks for your lack of upkeep. Repairs and replacement can occur sooner than they normally would if the components and equipment had been maintained on a regular basis. The "new" HVAC you had installed only five years ago can breakdown prematurely if you haven't changed the filters regularly or had it serviced annually. If you're not accustomed to doing routine maintenance, start following a regular home maintenance schedule.
Even if you are great about maintaining your home's systems, ignoring its aesthetic appeal can give buyers the impression you've been lax about maintenance, whether or not it's true. Here are just a few things that send up red flags for buyers and devalue your otherwise fine home:
- Watermarks on ceilings or walls that could indicate plumbing and roofing leaks or potential mold problems
- Smoke and pet odors that you may not notice; other signs of pets, such as scratch marks, torn screens
- Cracked driveways and walkways in need of repair or replacement
- Peeling paint, dented or rotted siding and window frames
- Overgrown yard, weeds, and poorly manicured lawn
- Pest infestations
Buyer's can't "unsee" first impressions. Make them good ones.
Not making the right upgrades can drop your home's value, but making the wrong upgrades or doing a poor job of trying to make the right ones can also slash your selling price. DIY blunders like renovations that are not up to code can cost buyers a fortune to undo the damage. Savvy buyers can check local building permit records to find out whether your home's modifications are on file. If not, they'll know there can be some potentially costly problems.
Even remodels done by contractors or new home builders, for that matter, can raise concerns during home inspections. Homeowners who fail to properly vet their contractors have been left with half-finished remodels or faulty electrical wiring. Hire someone who is licensed and insured, and check their references.
Even with the best remodeling quality, some home modifications prove to be too elaborate. They fail to impress buyers and don't bring you the return on investment you had hoped. These types of remodels could have a negative impact on your home's value:
- Floor plan alterations that create awkward traffic flow
- Remodeling a bedroom for use as a gym or home office
- In-ground or above-ground pools
- Exotic or extreme decor
Remember that the majority of buyers want the best price and/or the best value for what they're paying. Any real or perceived home faults they think will cost them money could lop thousands of dollars off your asking price. Give them as few reasons as possible to devalue your home.
Photo credit to Kevin Irby