Boost Your Home’s Value: 4 Projects with the Greatest “Bang for Your Buck”

No matter if the housing market is up or down, you always want to ensure home remodeling projects are wise investments.  According to Remodeling Magazine’s Cost vs. Value Report 2011-2012, there are several home improvement projects that will provide significant enjoyment to you now and could recoup a majority of your dollars whenever you decide to sell.

Beautiful bathrooms:  According to the report, a mid-range bathroom remodel ($16,000) can recoup up to 62% of the investment when it is time to sell…and in the meantime, add significant enjoyment with a new, relaxing retreat.  To start determine which updates matter most and how much assistance you will need for each.

Complex projects, such as structural, electrical or plumbing changes or installing countertops or flooring, may be best left to the professionals.  However, there are many updates you can tackle yourself.  Painting is an easy and ideal do-it-yourself task that can make a large impact with minimal cost.  Similarly, installing new faucets, accessories and showerheads can be simple, even for a novice. 

Classy kitchen:  Once you have updated your bathrooms, the kitchen is a rewarding home renovation that when done moderately can recoup up to 72% of your investment.  Based on your budget, you will need to determine whether to update with a lower-cost laminate or a higher-priced option, such as granite or marble, that can offer an upscale look, added durability and functionality.

Lighting, while functional, also adds a significant style element to a kitchen.  Replacing fluorescent fixtures with recessed cans or pendants will add ambiance and luxury to your room.  Update your old appliances.  Add a splash of paint to the walls and trim for a polished look.  Finish off the counter area with a new high-end kitchen faucet.

Envious entry:  It is the first thing your guests and future home buyers see when they approach your home, so if your front door is not appealing or does not have significant features, it is time for an upgrade.  A new entry door adds instant curb appeal for a minimal price and can recoup up to 60% of your investment.

When choosing a new door, fiberglass options are an ideal choice.  The material resists denting and scratching, is easy to maintain and can make your home more energy efficient.

Wonderful windows:  Similar to the front door, replacing your existing windows with new vinyl windows will give your whole home a new look and feel, both inside and out, and payback of up to 68% of your investment.  As a larger-scale project, this is likely a project left for the professionals.

Look to your local window distributor to refer you to a reputable contractor to ensure your new windows are installed properly.  When it comes to selecting windows, vinyl is an all-around excellent choice.  Unlike wood, vinyl windows resist rotting and do not require repainting.  Unlike aluminum, vinyl windows will never pit or flake.  Plus, you can enjoy a pay off immediately with increased comfort and lower utility bills, while potentially adding significant resale value to your home in the future.

 

Understanding Short Sales

A short sale is a sale of a home that is worth less than the mortgage owed.   Because these properties are often listed at a price lower than their values, you may be able to get a good deal, if you have a tremendous amount of patience.   The problem is that the only motivated people in the transaction are the agents and the buyer.  If you decide to make an offer on a short sale, it will generally be submitted by your agent to the seller for acceptance, subject to the short sale lender’s approval.  This can take months, so I tell the buyers, “This will take a lot of time, so don’t call me up, whining about it.”  There really is nothing you can do to speed up their decision.

It is very important to structure the purchase contract such that it gives the buyer an out of the contract if an acceptance is not obtained within a certain time-frame.  Also, it is best to have the different time-frames for inspections, putting the deposit into escrow, obtaining the loan, and so on begin at lender approval of the deal rather than at seller’s acceptance.  We have a very good short sale addendum that is required for every short sale transaction.

It is very important to have a short-sale property inspected by a professional home inspector.  Many times the upside-down seller has not maintained the property.  Very rarely will the short-sale lender agree to pay for any repairs, so it is a good idea to get a contractor’s bid to repair the items so you will know if  the cost is unaffordable.

The short-sale lender will come after the buyer and the agent for money.  One of my buyers said, “Tell them to go pound sand!”  The lender stopped asking him, but then they came after me for some the commission.  If there is more than one lender, the sale is even more tedious.  Unless the lender in first position comes out with what is expected, they will try to cut down on proceeds going to the junior lien holders.

Someone purchasing a short-sale property should just be prepared and patient and don’t get mad (they don’t care!) and a good agent comes in handy, too.

 

Court Decision Regarding Roommates

A ruling was made in the Ninth Circuit (federal court) three weeks ago regarding roommate selection and whether it falls under the laws protecting against discrimination.  The scenario in this case was that Roommate.com requires certain criteria be inputted by the person putting themselves/their property into the system and allows for those searching to select based on those same criteria, including race, sex, sexual preference, number of children, etc.  The Fair Housing Council of San Fernando Valley brought suit against Roommate.com claiming that it was discriminatory for Roommate.com to require users to disclose certain preferences as that is discriminatory and that it  is a violation of the federal Fair Housing Act (FHA) and California Fair Employment and Housing Act (FEHA). The 9th Circuit ruled against the Fair Housing Council stating that a shared living situation does not fall within the definition of “dwelling” for either the FHA or FEHA and further that the 1st Amendment protects people’s freedom of association regarding a choice of roommate.  This is good news for those who share or wish to share their living space but only under certain circumstances or with certain types/classes of people.

Although this does not generally affect buyers and sellers, the amount of leasing going on in our area has definitely increased and people who have never had a roommate before may be leery to have one without knowing that they can control who comes into their living space.

 

For further information, see Fair Housing Council of San Fernando Valley v. Roommate.com __ F.3d __ , 2012 WL 310849, at p. 1 (9th Cir. 2012).