Thank you to everyone who wrote in and gave feedback on our last topic of Ice Damming and Attic Rain, it was perfect timing given the relentless winter we are having.
This week we’ll deal with a question from Anne René who lives in West Valley. She emailed me to ask a question I have heard all too many times in the past.
“We are thinking of selling our house. Will it sell faster if we renovate the kitchen and bathrooms? Should we just paint the walls or maybe new countertops and plumbing fixtures?”
As the owner of a custom cabinet shop and renovation company, I would love to say “Yes, renovate all of it!” but that may not always be the best investment. Everyone’s circumstances are different and are generally defined by how much equity they can get out of their house after they sell. Now before you take my advice, I am not a real estate agent. I myself would consult an agent if I were considering selling as they can offer a wealth of knowledge towards this subject. Some houses you may think need a full renovation may need nothing as they are in a desirable area and could trigger a bidding war simply based on location, style of home or even the yard.
So let’s give Anne René 4 options. I find it easier to understand if you can associate some costs with the equation. Let’s leave out real estate and legal fees for ease of figuring.
- Timing. This is the most important consideration in my opinion. No matter how much you want to spend on renovations, the question is how long will you actually be able to enjoy it yourselves before you move out? Some people spend $50,000 on renovations to their home and only get to enjoy it for 6-12 months. Try not
to fall in love with what you are changing as you won’t get to appreciate it for long if you are planning on selling right away. Also, your taste may not be that of the new home owner. - You purchased a home in the East end of Cochrane. It is old and needs a full renovation in your opinion. You paid $365,000 for it 5 years ago and now it’s value is around $450,000. You will make approx. $85,000.The east end is a desirable location for a lot of people and it may sell fast. Do you really need to spend money on a kitchen or bathroom renovation? Now if you were staying for a few more years, then yes, maybe update some flooring, paint and maybe just do either the bathrooms or the kitchen. You will still come out ahead.
- You purchased a home in West terrace 20 years ago. It is fully original complete with all the Berber carpet, Golden Oak cabinets and trim. You paid approx. $185,000 for it and now it’s value is $545,000. You have pulled $100,000 worth of equity out of it but will still make approx. $260,000.There is one catch, there are quite a few other listings in the area and some of the others are already updated. Unless you have a layout everyone will love or the best yard in Cochrane, you may have some stiff competition. In this case I would say yes, don’t go crazy but maybe new cabinets, granite tops, under mount
sinks and plumbing fixtures and of course a fresh new color on the walls. Again, if you want to enjoy it for a few years, you could consider tile backsplash and flooring. - Lastly, you purchased a home 8 years ago in Bow Ridge when the market was hot and prices were high. Your home is clean and pleasant, had some older renovations but has not been updated for a long time. You paid $475,000 for it and now its value is $545,000. You will make approx. $70,000. Again, there are at least 6 other listings in the area, some of them have been updated but you have a nice location, your house is clean and shows well. For this example it may be wise to maybe change some countertops, install some new plumbing fixtures and paint just the areas that show the most wear.
Thank you for contacting us Anne René, I hope this helps answer some of your questions. Every scenario is quite different and it is always a good idea to have an agent or a renovation contractor offer an opinion. As always, check with the experts and professionals that will take time to find and fix the problem or help you with your project.
If you have your own question, we’d love to hear from you; email me at scott@mastersgroup.ca. Scott Irmen is the owner of Masters Group Ltd., a Cochrane-based renovation and construction company that has been changing spaces since 1997.