In a seller's market does kitchen & bath updating make a financial difference? (condo, value)
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Maybe. If the 'sellers market' is mostly refinished, move in ready homes it may make the difference between taking 30 days to sell and getting bid up above asking with competing offers. Depends on what is selling in your area. ...
So if there's a deficit of updated homes in your area, it may be worth remodeling. Otherwise probably not.
Excellent point. An outdated home will suffer in comparison, as buyers will see it as a project and not as a move-in ready home.
I've heard that business about not remodeling because buyers might not like your style and it is better to knock $30K off the price than put $30K into a kitchen.
I've always wondered if that was true.
For most homes it is true. In my current local market there have some big gaps in inventory at certain price points. When we bought, there were quite a few estate sale fixers and very little new construction or recent remodels available. Anything new was priced close to a $1M, so you had a choice of homes between $300-$700K nearly all of which were in various states of disrepair, or you could spend $1M for one of the few newer homes. Not the best selection for buyers wanting something move in ready but unwilling to spend 7 figures. There was an opportunity for flippers to come in and remodel older, larger (1800+ sq ft) homes and price them in the $600K-$800K range where no new inventory was being built due to land costs.
Flippers came in and turned a bunch of the more dilapidated $300K homes into $600K-900K homes to meet demand. Towards the lower end these places were way beyond the budget of most homeowners to finance renovations (I know, I looked at a bunch of them!). But other homes that were well maintained but outdated could also benefit from a strategic remodel.
Whether this is an option for the OP depends on what's going in in their market.
When I purchased my current home, I went looking for a house that had "Dated kitchens and baths." Fortunately, I found it. My mid-century modern home (built 1962) was untouched by the ravages of beige.
Point is, different people like different things.
I've always thought it's wiser to let potential homeowners do any work that's needful.
I have been told by several high end realtors that there's a market of willing buyers with large incomes who want impeccable move in condition. They want a completely updated house and are willing to pay for it rather than do the renovation work themselves, even a kitchen remodel. These buyers are people with busy and demanding jobs and don't have the time to deal with the inconvenience of a remodel.
This, I'm sure, only applies to certain sectors of the real estate market in certain areas. But it probably explains why high end flips can be very profitable in places like Los Angeles.
I have been told by several high end realtors that there's a market of willing buyers with large incomes who want impeccable move in condition. They want a completely updated house and are willing to pay for it rather than do the renovation work themselves, even a kitchen remodel. These buyers are people with busy and demanding jobs and don't have the time to deal with the inconvenience of a remodel.
This, I'm sure, only applies to certain sectors of the real estate market in certain areas. But it probably explains why high end flips can be very profitable in places like Los Angeles.
This is very true in all price ranges. The lower end range, those buyers can't usually afford it. The mid-range, many work too hard to have the time to do it. In the higher range, they don't want to live in dust and muck while it's getting done.
I am currently working with a multi-million dollar buyer who will not look at anything not updated. She's gone through renovations before, and now she wants something that someone already did the work and she can just unpack.
I'm in the opposite situation. It's a buyers market here and my home is in need of updates as well. My realtor is pushing me to make updates but I know in the current market here I won't see a return on my investment. I can't update everything and all the buyers will see are the things that aren't updated. I would prefer to just reduce the price. The house was on the market for 2 months with lots of views but no offers. We have taken it down temporarily for health reasons but plan to put it back in a few weeks. My realtor wants me to use this time for updates. We decluttered, repainted but the flooring, kitchens and baths need updating. The home has great curb appeal and a lot of updates have been done to the exterior but we just don't have the funds for the interior. My taste in updates might not suit others. I would rather negotiate the price to allow buyers to do their own updates.
Last edited by CouchTater; 09-17-2014 at 11:52 AM..
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