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Hi,

Do you think it’s easier to sell a renovated house at a higher price than an unrenovated house at a lower price?

For example, I’m going to put my one bedroom condo up for sale and hope to get 300K. It’s old with carpet floors, old kitchen cabinets and countertops, and a bathroom with an old shower stall that dates back to the 70s.

Is it easier to sell the condo with 30k of renovations at a higher sale price of 330k, or leave as is for 300k?

I believe that it’s better to renovate since a buyer would probably not have the extra cash to renovate after putting a down payment on the condo and would prefer the larger mortgage with renovations. Does anyone have any strong opinions or experience one way or the other?

Thank you,
Carl
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No opinion

but you might try this board:
https://boards.fool.com/building-maintaining-a-home-100167.a...

which is more active.
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Do you think it’s easier to sell a renovated house at a higher price than an unrenovated house at a lower price?

I think it depends a lot on your market, your price point within your market and what renovations need to be done. Also, if you are doing the work yourself vs. paying a contractor to do the work, it will make a difference on whether the renovations will make it more profitable for you. I would suggest talking to a good real estate agent in your area.

If you do decide to renovate, be sure you get any permits needed.

For example, I’m going to put my one bedroom condo up for sale and hope to get 300K. It’s old with carpet floors, old kitchen cabinets and countertops, and a bathroom with an old shower stall that dates back to the 70s.

Is it easier to sell the condo with 30k of renovations at a higher sale price of 330k, or leave as is for 300k?


I would be surprised if you could get all the floors replaced, a new kitchen and a new bathroom done for $30k (unless you're just talking materials, because you're doing the work yourself). Even if you did, the question is - will you really be able to sell it for $30k more? You need to look at the comparables in your complex, and see if the updated ones really sell for $30k more than the non-updated ones.


AJ
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Danbobtx, thanks for the link. I found a thread that discusses my question on that board. Very helpful. The people discussing would like to do the renovations themselves, but they believe they are in the minority.

AJ, thanks for the advice. For 30k, it’s not a total renovation, but my realtor definitely suggests hardwood floors and redoing most of the bathroom.

Carl
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Carl,

It is very hard to sell a fixer upper these days and you will likely take a price hit that is greater than what you would put into it. That said, be smart about what you do. Some renovations add more value than others.

Look at your property and approach it like a buyer. Does it say deferred maintenance? Fix it. Does it say dirty? Replace it. Cluttered? Remove it. Fresh paint always is good. At least clean your carpets or replace with new. Yeah, hardwood floors are a great selling point, and will make it easier for your Realtor to sell, but if the carpets are not worn or a crazy color, consider just having them professionally cleaned.

Kitchens and baths are emotional push points. Nothing kills a sale faster than outdated kitchens and baths. If you keep the existing floor plan in your kitchen and don't change around the electrical or plumbing, the cost of replacement does not have to be extreme. We have used Wolf Kitchen Cabinets in 3 kitchens we'e renovated, one a home that sold for almost $600K, and find them to be a good value. https://www.wolfhomeproducts.com/wolfclassic Basic grade granite is not that pricey, and there are some great looking laminates out there.

If there are things that you believe need to be addressed but you chose not to do so, have quotes or even multiple quotes to get the work done. Making these available to the buyers will keep them from imagining HUGE replacement costs. The buyer will typically believe it will cost much more money than it does, so have concrete ways to tamper that fear down.

But as AJ says, what you do will depend on your area and where your property fits along the norms there. Your Realtor, if you picked a good one, will have ideas to improve your ability to sell quickly at a better price. But be aware that some Realtors are more interested in making their job easier than putting more money into your check. I say that having been a Realtor. There are good and not so good out there.

Good luck with your sale.

IP
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It is very hard to sell a fixer upper these days and you will likely take a price hit that is greater than what you would put into it.

Had dinner with a friend yesterday, he's a professional lender, generally to professional flippers. In So Cal there's a shortage of available properties to flip so many people are chasing the same deal. Great seller's market. However, ...

They need to factor profit into their selling price, since the after upgrade selling price is limited by market, they need to take their profit out of their purchase price.
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I agree it depends on the market. And the numbers.

Many buyers do want to move in soon. They do not have time for renovations first.

Some renovations can be done in a few weeks. Others can take months to schedule.

They tell you fresh paint and carpeting (or floors) are the big sellers.

Some things you mention are inexpensive. Old shower replacement is probably $2K or less.

Keep an eye on your budget. Try to pick wisely.
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You can find lists which tell you the approximate resale value of various upgrades. Some increase the home value, some are neutral, some cost more than they return.

Cosmetic stuff, carpets, paint, landscaping cleanup are generally easy and cost effective.
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Do you think it’s easier to sell a renovated house at a higher price than an unrenovated house at a lower price?

Location, location, location

Easier ? It Depends

Faster ? A well-priced renovated house is likely to sell faster but it so depends on the market.

Condo ? Depends - again location. Compare total monthly payments including any condo fees.

Strong opinions ? Am I the seller or the buyer ?
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JiminyBillyBob:

"Do you think it’s easier to sell a renovated house at a higher price than an unrenovated house at a lower price?

For example, I’m going to put my one bedroom condo up for sale and hope to get 300K. It’s old with carpet floors, old kitchen cabinets and countertops, and a bathroom with an old shower stall that dates back to the 70s.

Is it easier to sell the condo with 30k of renovations at a higher sale price of 330k, or leave as is for 300k?

I believe that it’s better to renovate since a buyer would probably not have the extra cash to renovate after putting a down payment on the condo and would prefer the larger mortgage with renovations. Does anyone have any strong opinions or experience one way or the other?"


Most remodeling work does not return 100 cents on the dollar.

See, https://www.remodeling.hw.net/cost-vs-value/2018/

Remodeling, to a certain extent will, broaden your buying base because many buyers do not want to deal with remodeling, they want move-in condition, an my lead to more net proceeds because many buyers overestimate the cost of the remodel (and, IMO, add-in a PIA factor, too). It may also lead to quicker sale as a result, which save you some carrying costs.

So for your example, "Is it easier to sell the condo with 30k of renovations at a higher sale price of 330k, or leave as is for 300k" it might be more like 320 or 235 if you do 30k of remodeling versus 280k without the remodel.

Regards, JAFO
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Obviously it depends on location and people have different opinions of what is "ok".
And yes, I've heard from agents that people tend to be pickier now due to all of the tv shows.

I think the best rule of thumb is to fix easy things but things that turn off people. While painting is something most of us can do, and isn't anything structural, many buyers have a tough time imagining a place with fresh neutral paint. So generally painting walls is a pretty easy job (I'm not handy but I've done too much painting a few houses).

Tidy things up and throw away stuff.

If something is old but functional (e.g., HVAC) don't spend money on it.

Clean up the yard so people driving by can make a good first impression.

The worst things are major repairs that aren't needed. People spend $100K on a new kitchen in a $400K house. You aren't going to make your money back. Instead paint cabinets or get new doors/hardware on them. Get some new light fixtures.

If the house is a mess, get it professionally cleaned.

Carpet is pretty cheap and can easily be replaced.

And figure out if anything is a structural issue since that will (or should) show up in a home inspection. Same for bad water drainage issues.

I'm not handy but due to locations and my budget, I've bought a couple of fixer uppers but the kind on the low end of fixing. That is, structurally they were fine but cosmetically needed updating. I think the only original things left in my recently sold house in MD was the refrigerator, windows, HVAC, and the hardware floors (they were covered in ugly green carpet). Every room was painted, bathrooms slowly remodeled (for a reasonable price), kitchen redone but for more of a $20K price tag.

Whatever you do, consult with several real estate agents and try to figure out a consensus. Some agents simply want to get a listing, the good ones will tell you what to do or not to do. I was pondering what to do with a fireplace, keep it as is or turn it into a wood stove. An agent said in my area, it is a 50/50 thing so don't waste money on it.

While I avoided reading a lot of opinions left by prospective buyers some were amusing. "Loved the house but all the rooms are too small" (Well a 2,000 sq ft home is only so big.)

Good luck.
Rich
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"Loved the house but all the rooms are too small" (Well a 2,000 sq ft home is only so big.)

Two story house with vaulted ceilings in a great room can mean tiny bedrooms. Use those 2000 sf wisely.
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I'll add my $0.02.

Definitely change out anything that screams 1970s. DW & I recently looked at a house and the bathroom was probably like yours. Everything about it screamed 70s/80s. Gold faucets, gold towel bars, gold shower door knob, etc., etc., etc. Immediately made us wonder about general upkeep and maintenance of the entire house.

What you replace, go neutral, not necessarily trendy. Buyers can add their own touch to the place with accent pieces and doo-dads and not be worried about their stuff matching some bright color and ultra-modern light fixtures. Toupe and shaker beige are great wall colors.

Definitely declutter, especially closets. Get rid of 1/2 the stuff in them so they look bigger. Plus, makes it easier for the buyer to imagine their stuff in there.

JLC
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Hi Everyone, thank you for all the advice. I’m going ahead with a partial renovation with the awareness that I probably won’t get dollar for dollar return, but because my condo has sat for a while already on the market without any offers, I feel after the partial renovation, I’ll get some. I’ll let you know how it goes.

Carl
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I’m going ahead with a partial renovation with the awareness that I probably won’t get dollar for dollar return, but because my condo has sat for a while already on the market without any offers, I feel after the partial renovation, I’ll get some. I’ll let you know how it goes.

Consider "refreshing" the listing when you are done with the renovations. You take it off the market and put it back on as "new." This will get the listing re-sent to people who may have passed on it because of it's previous condition. It would be an easier way to deal with a price change as well.

Good luck.

IP
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my condo has sat for a while already on the market without any offers,

After 18 years in residential rentals, I've learned no offers means the price is too high. Either the value needs increasing to match asking price or price needs decreasing to match value. Which I suspect you've already realized.
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I’m going ahead with a partial renovation with the awareness that I probably won’t get dollar for dollar return

I would suggest taking it off the market while you're renovating. It will be easier to 'refresh' the listing (as inparadise suggests) with a new price if it's been off the market for a while. Assuming that your listing has been on Zillow, it's easy for anyone to track time on market and price changes. Even if it hasn't been on Zillow (and it probably should be), the MLS system likely allows agents to track those changes.

because my condo has sat for a while already on the market without any offers

I agree with JonathanRoth that the price is too high if you haven't gotten any offers. As the old adage says "There is nothing in real estate that price cannot fix."

Is your current asking price the price that partially renovated condos in your complex actually go for? If so, your partial renovation may get you your current asking price, but it probably won't get you more. If it's the price that fully renovated condos get, then a partial renovation may not even get you your current price.

You should ask your real estate agent to get you pictures of the comparables that your price was based on, so you can see what condition they were in. That way you can determine which renovations will be needed to get your current asking price.

AJ
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my condo has sat for a while already on the market without any offers

If you had led with this, you might have gotten different responses.

You'd probably get even better ones if you identified the real estate market.
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And this is where an experienced and higher volume agency should help. Agents tend to rely on price/sqft to price a house and that is seriously flawed. One home could be in pristine condition and the other may need tens of thousands of dollars to get up to date. An experienced agent has been in a number of the homes and can adjust the price accordingly.

Of course you get some sellers who become fixated on a certain price point and won't adjust and don't understand why it doesn't get any offers. A number of buyers won't put in a low offer thinking it isn't worth the time and assume the seller will quickly reject it. So the house gets no offers.

I once had an agent complain to me that I priced it too high. She quickly got fired since I only priced it at the number she had suggested.

Real estate is tough because you are dealing with a lot of money, often leveraged money, and people get emotional about it.

Condos, depending on the area, can be difficult.

Rich
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