Stager Karen Eubank said it best when she told me why some homes were flying off the market and others weren’t: If you’ve upgraded and invested in your home before listing, you’re almost certain to sell. If you haven’t, good luck.
Apparently that’s the advice a lot of Texas homeowners are getting from their Realtors and stagers, because remodeling projects are growing not only more profitable for sellers this year, but more and more Texans are sprucing up their homes and taking on more projects.
In its just-released 2014 Texas Remodel Valuation Report, the Texas Association of Realtors analyzed the costs and return on investment for more than 20 projects throughout the state. Save for the Alamo City, return on investment for remodeling projects is up year-over-year, and smaller, more functional upgrades made a bigger bang for their buck over larger, more luxury-oriented projects.
“All aspects of Texas real estate are strong, including the home remodeling market,” said Dan Hatfield, chairman of the Texas Association of Realtors. “As demand for Texas homes continues to rise, homeowners and sellers can significantly contribute to their home’s resale value through small projects and smart additions.”
We agree, and a lot of these projects are cost-effective ways for sellers to help improve the curb appeal of their home, including replacing steel entry doors, which was the No. 1 project for total recoup cost, making at 105.5 percent return on investment. Kitchen remodels ranked in the top 5 for total recoup cost over all five Texas metros, making 143.9 percent of the total project cost. Backup generators were another cost-effective upgrade, as well as replacing vinyl and other synthetic materials with natural options, such as wood and stone.
In addition, projects that increased a home’s livable square footage using existing spaces showed significantly higher recoup cost values and growth in 2013. Basement remodels ranked in the top five for recoup cost in four of the five major cities in Texas, recouping up to 99.6 percent of the total project cost.
Conversely, costly room additions and upscale remodeling projects were among the least profitable projects. Sunroom additions, for example, ranked in the bottom five for recoup cost in five Texas metro areas, recouping a maximum of 61.3 percent and as little as 38 percent of the total project cost.
“Texas homebuyers want a home that not only meets their family’s needs but maximizes existing square footage and functionality,” said Hatfield. “But with a competitive housing market in many of Texas’ metro areas, more homebuyers are willing to do remodeling projects once they purchase a home instead of waiting for that perfect home to come along.”
We agree! And even better is that a home with livable upgrades will sell much faster. What are your thoughts?
