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It is said that "to make money, one must spend money." This is especially true in the world of Los Angeles luxury real estate. One of the first steps a real estate agent takes to prepare a home for sale is to recommend renovations that will raise the property's asking price. Renovations can improve value by improving aesthetic, increasing functionality, or eliminating liability.
FOCUS ON THE RENOVATIONS THAT WILL RAISE YOUR ASKING PRICE THE MOST
Mercer Vine's luxury real estate agents have narrowed down 7 home renovations that will improve the value of your home. For every renovation, we've included its difficulty level, renovation cost, how much value it adds, and a brief description of how it may improve asking price. Whether you're thinking of selling, buying, or investing in real estate, this piece will help navigate the waters of home remodeling to improve the value of your home.
MERCER VINE'S TOP 7 HOME RENOVATION TIPS:
- Renovation Difficulty: Easy
- Renovation Cost: $25,000 - $30,000
- Home Value Increase: $35,000
One of the first renovations that comes to mind for Los Angeles homeowners are solar panels. Installing solar panels in a state as sunny as California is a no-brainer for owners who are looking to easily entice buyers and increase asking price. Even if homeowners are not yet ready to sell, the choice to install solar panels is still wise given the amount of money they will save in utility bills. Many homeowners report that solar panels practically paid for themselves only 2 years after installation due to reduced utilities. Since this renovation is eco-friendly, installation tax credits are available from both the federal and state governments. Homeowners should be aware that the project requires highly technical installation, so they should save this job for professionals.
- Renovation Difficulty: Difficult
- Renovation Cost: $7,500 - $20,000
- Home Value Increase: $10,000 - $20,000
Due to the constant influx of water, the bathroom is often the part of a home that wears down quickest. Though tax rebates are not typically offered for residential bathroom renovations, this shouldn't discourage homeowners. A functional, polished bathroom instantly raises home value, as the quality of bathrooms is often the source of making-or-breaking a buyer's interests. Additionally, bathroom remodeling is definitely a project that falls into the D.I.Y. category. Homeowners can save thousands by doing demolition, tiling, and finishing work themselves. However, larger tasks such as major plumbing should always be left to professionals.
- Renovation Difficulty: Difficult
- Renovation Cost: $50,000 - $100,000
- Home Value Increase: Varies greatly, but always in the thousands
Aside from the price of the property, the very first detail mentioned in a real estate listing is always the number of bedrooms. What makes an extra bedroom valuable is its ability to be converted into any other type of room (except, of course, a bathroom or kitchen). For example, an extra bedroom might be valuable for a buyer who works as a musician that may need an additional room for a studio or practice space. For a professional buyer, the added room may serve as an office. Even if the buyer does not need an extra room for work, the bedroom may be used as a hobby space or exercise room.
- Renovation Difficulty: Medium - Difficult
- Renovation Cost: $4,000 - $35,000
- Home Value Increase: $20,000 - $75,000
Heat map studies of homes reveal that the average person spends most of his or her time in the kitchen. Therefore, if homeowners are thinking of renovating only one aspect of their home, the kitchen is the best choice. Bear in mind, however, that government tax rebates and incentives are not usually available for kitchen renovations. Dominic Labriola, real estate agent and a founding partner of Mercer Vine, says that kitchen renovation "could range from something as small as installing new appliances to a full kitchen rehab." Installing new appliances can start at about $4,000 and go up from there. New countertops can make a huge difference in giving kitchens a sleek, new look. Sometimes you don't need to replace the cabinetry; it can be re-faced, repainted, or have new hardware installed. A reface of cabinetry and new countertops can start at about $10,000. A completely new kitchen can start at about $35,000 and go up from there." Dominic also adds that kitchen refreshes are projects that savvy homeowners can definitely undertake themselves. Larger jobs such as replacing cabinets and countertops, however, should be done by professionals.
- Renovation Difficulty: Medium
- Renovation Cost: $450 - $12,000
- Home Value Increase: 20% of current value
Depending on how many windows a homeowner chooses to replace, the size of this project can vary. Although it is difficult to say exactly how much new windows will appreciate a home's value, there are definitely huge energy savings to be made for homeowners and buyers alike. Since changing windows improves the insulation and heating needs of a home, the government offers $2,500 - $20,000 in loans to help fund this eco-friendly project. If homeowners are only changing a few windows, this is certainly a task they can undertake themselves. Changing most or all of the windows in a home, however, would best be handled by contractors.
REMOVING POPCORN CEILING
- Renovation Difficulty: Easy
- Renovation Cost: $800 - $2,000
- Home Value Increase: N/A (although it dramatically improves safety and aesthetic)
Popcorn ceiling removal is, by far, the easiest solution to modernizing a space. This project can vary in difficulty based on the total area to be scraped. Used in the 1950s and 1960s, popcorn ceiling was the favorite option for contractors that needed to quickly conceal ceiling imperfections. However, due to the slew of asbestos and mesothelioma cases traced back to the popular ceiling treatment, popcorn ceiling was legally banned in the 1970s and 1980s. Prospective buyers, can therefore, undermine a seller's asking price since popcorn ceilings may present a health hazard. For this reason, homeowners should always have a professional test the area to be scraped before undertaking the project themselves. Unfortunately, there are currently no government tax rebates or incentives offered for popcorn ceiling removal.
- Renovation Difficulty: Hard
- Renovation Cost: $5,000 - $25,000
- Home Value Increase: 15% – 40% of home's current value
Although re-roofing is definitely on the more rigorous side of home remodeling, this is another renovation that can drastically improve the aesthetic and safety of a home. Leaks during rain, poor hatching, or shingle warping, portent of possible disaster and may be considered a liability to buyers. If homeowners want to secure their asking price, re-roofing is an excellent way ensure that buyers cannot undermine a seller's price by a large amount. If the new roof is made of metal and asphalt, government tax credits are available for up to 10% of the renovation cost since it improves home insulation and reduces the homeowner's environmental footprint.
SOME RENOVATIONS ARE BETTER THAN OTHERS
Not all renovations are sure to raise your home's asking price while others may end up costing more due to other factors. For instance, renovations like installing solar panels might end up costing more than average if the roof needs to be reshingled. Popcorn ceiling, on the other hand, might not raise value by a concrete number but its removal might be the difference between a home in the hundred-thousands and a home in the millions. Whether it's a small renovation or a major one, Mercer Vine's team is always here to advise.