On one hand, some home improvements translate to life improvements. That new kitchen remodel will increase functionality and the aesthetic will elevate your mood. You might feel like having people over more often. Life is better.
On the other hand, some home improvements are necessary and fall more into the home repairs category. Most of the plumbing fixtures in the house are dated and leak sometimes. The water heater is working, but just barely. That stove burner hasn’t worked in ages.
It’s time to change it up!
Long Term
Your goals should determine your home improvement choices. If you plan to live in your home for many years, then big-ticket items like a major remodel or a swimming pool take you closer to domestic utopia.
For major improvements, you’re more concerned with a lifestyle than how much value is added to a sale price in 15 years.
Short Term
If you’re thinking about selling your home in the next few years, your wallet will thank you for focusing on smaller, more practical upgrades.
Speaking in financial terms, you will maximize your return on investment (ROI) by carefully selecting the right home improvement projects.
Net Value Added
For this article, we are discussing the net value that’s added by a particular home improvement (value added>cost).
Optimally, a homeowner wants the value of an upgrade to exceed its cost. However, many improvements will instead cost more than the added value.
Before biting off more than you should chew, let’s review 20 home improvements that do not add a net amount of value to your property.
1. Garage Conversions
Converting your garage into a living space can be a good idea if you need more room for your family. But reducing garage space could make your home less appealing to buyers who need the garage space.
Moreover, converted garages can often compromise the look and feel of the home and might be considered tacky. Most homebuyers view the conversion as an additional cost to convert it back to garage space.
In fact, according to an Impulse Research survey, 80% of potential homebuyers would find garages essential when considering a home to purchase. As people accumulate more stuff, valuable storage space is a big draw for many buyers.
2. Installing Solar Panels
Solar panels are an eco-friendly way to power your home and reduce energy bills. However, installing solar panels may add less value to your home than you think. While some buyers may be attracted to a home with solar panels, others may see them as a liability.
For example, some potential home buyers might not like how solar panels alter the look of the home. Also, while maintenance is fairly minor, some people would rather not deal with it.
Moreover, many solar systems are leased or financed and buyers must assume those obligations. In addition, some of those leases have onerous terms that stay with the property.
Even if the solar panels are owned outright, the amount of value added is usually about equal to the cost.
3. Luxury Upgrades
Luxury upgrades like high-end appliances, marble countertops, or gold-plated toilets may appeal to some buyers. However, they won’t likely add any net value to your home. Luxury upgrades may even turn off some buyers who would rather not pay for features they don’t need or want.
Additionally, some luxury items and upgrades may be outside the price range of homes in your neighborhood, which could make your home harder to sell. It’s the proverbial white elephant.
Check out The Complete Home Seller Checklist
4. Over-Building or Over-Improving
Think twice or thrice when dreaming about a large addition to your home, especially if all the homes in the neighborhood will be smaller. There’s the white elephant again!
Overbuilding for the neighborhood can make your home stand out negatively and make it harder to sell. Your square footage should be roughly the same as other homes in the area.
For example, if all the homes in your neighborhood are single-story ranch homes, building a three-story colonial will make your home look out of place – and it will surely annoy your neighbors.
There’s such a thing as “too much house.” Your home’s appraised value will almost certainly be less than the amount of money spent on the improvements.
5. Renovating an Attic or Basement
Renovating your attic or basement can be a cost-effective way to add more living space to your home. However, these home renovations may add very little net value to your property, especially since they likely must be approved by a city or county inspector before the county assessor will include the added square footage.
Some buyers may also be wary of homes with finished basements or attics because they may worry about water damage or mold. If you plan to renovate your attic or basement, do it right and obtain the necessary permits to ensure it’s safe and legal.
6. Replacing Windows and Doors
Replacing old, drafty windows and doors can improve your home’s energy efficiency and curb appeal. However, it may add little value, especially if you choose expensive, high-end materials.
Moreover, some buyers may not appreciate the added expense of these upgrades, as they may not be interested in paying extra for energy-efficient features. Instead, consider upgrades that are easier on the bank account, like adding more insulation or sealing air leaks. These can make your home more energy efficient while being cost-efficient.
7. Unique Landscaping
Your front yard is Shangri-La. Your kids love the giant hedge shaped like Mickey Mouse and you love the replica of the Pirates of the Caribbean ride. It’s very cool, but perhaps not for everyone.
You will notice a common theme throughout this listicle, which is maintaining your home to appeal to as many buyers as possible. Although the Mickey Mouse hedge might be an easy fix, removing the beloved pirate ride might cost more than family tickets to Disneyland.
Honestly, the Disney theme may not affect your home’s value. Some buyers may love it. The point is that some buyers may appreciate your unique taste, but some curmudgeons may not.
Of course, most people wouldn’t do something that extreme with hopes of adding value to a home. But it’s a good example of how money can be spent to create the happiest place on earth, but the cost will exceed the value added.
As with all the improvements listed here, stick to the common denominator if your goal is to generate a return on investment.
8. Adding a Media Room or Home Theater
Adding a media room or home theater is a great idea if you’re a movie fanatic, a movie critic, or really love popcorn.
However, it may not add net value to your home, and some buyers may even see it as a waste of space. If you add extra living space with a media room or home theater, make sure it can be easily converted back into functional space.
9. Adding a Sunroom
Adding a sunroom is a splendid way to enjoy the great outdoors without leaving the comfort of your home. However, adding net value is unlikely and some buyers may even see it as a liability. Sunrooms can be expensive to maintain and may only suit some climates.
Moreover, sunrooms can take up valuable space that could be used for other purposes. If you add a sunroom, you might want to make it easily convertible into another functional space.
10. Adding a Swimming Pool
Adding a swimming pool is great if you have kids, enjoy hosting pool parties, love water aerobics, or crave the cooling wetness in triple-digit heat. The choice to install a pool amounts to a lifestyle choice because it’s usually not a good ROI.
In the Bakersfield market, you can expect to pay a minimum of $40,000 to install a basic pool and appraisers rarely add that much value to an appraisal. Annually, there are solid 4 months of pool weather, and installing a pool is still not a good ROI.
The monthly pool maintenance costs may exceed the enjoyment factor. You can find decent pool maintenance for $100/month, but your water and power bills will also be higher.
You can DIY to save some cash but be prepared to regularly clean the pool, balance the chemicals, and repair as needed. Unless you use the pool often, it may become more of a burden than a benefit.
Lastly, if you live in a cooler climate, adding net value to your home won’t likely happen.
11. Expected Functionality
Most homebuyers expect a certain level of functionality and quality. Most people will avoid homes without running water or electricity, so the fact that the electrical panel had to be replaced will not add net value to a home. It’s an excellent selling feature but most buyers expect it in the first place.
Likewise, replacing the roof, a sewer line, or an HVAC system will not add value because the value would drop without them. They are upgrades that had to be made.
Of course, any upgrades should be highlighted in the marketing of your home. Just keep in mind that potential buyers may not be willing to pay a premium for them, so the full cost won’t be recouped.
12. DIY Projects
So you’ve watched a few home improvement TV programs. Now you think you can replace the tile in the shower or install crown molding in the living room? Please don’t!
Unless you have experience with DIY projects, they may hurt much more than they help. A botched attempt to install a new roof or electrical system can wind up costing more than hiring a professional from the outset.
Small DIY projects like some light landscaping or replacing the handles and knobs on your kitchen cabinets can save some money and add some value.
But poorly executed DIY projects can reduce the value of your home if poor workmanship turns off potential buyers.
13. Installing High-End Appliances
While high-end appliances may be attractive, they may not add value to your home. Except for high-end price ranges, buyers may not appreciate or need high-end appliances. High-end appliances are more expensive to maintain, finding that special part for a Viking stove.
Suppose you simply must upgrade your appliances before selling your home. In that case, it’s best to stick to appliances that are functional and attractive, but not too expensive. There are plenty of mid-range appliances that will do the trick.
If appliances are dated, worn out, or not working, then replacing them will typically add net value and eliminate a barrier to selling your home.
14. Wacky Wallpaper
Wallpaper may be a popular design trend, but it’s not always a good idea. It usually reflects highly personal taste, which isn’t optimal when trying to sell a home.
Wallpaper isn’t necessarily very expensive, since most jobs can be done for under $1,000. But like many other projects, it very likely won’t add value and buyers could see it as an additional cost and hassle after closing.
Stick to the rule of thumb. Always appeal to a wider range of buyers by using neutral colors and timeless design elements.
15. Color and Texture
Bold paint colors add personality to your home. But do you love everyone’s personality?
As mentioned above, it’s best to stick with neutral colors when selling your home. While you may love your bright green living room, potential buyers may not.
Neutral colors make it easier for people to imagine themselves living in your home, which makes it more appealing to a larger pool of buyers.
In addition, bold room colors can be difficult to paint over and signal a cost to potential buyers. Maybe a nice, bold color accent will make you happy?
The same applies to textured walls. They are difficult to paint over and can limit decorating options, another turn-off to potential buyers. Consider using temporary wallpaper or removable panels to achieve the desired look without a commitment to future work.
16. Carpet
The trend is definitely away from carpet and toward engineered hardwood or tile. At the very least, buyers want carpet confined to the bedrooms and hard surfaces in the common areas.
Carpets can be cozy and comfortable underfoot, but they can collect dirt, dust, and allergens and can be difficult to clean.
Carpeting can also wear out, absorb pet accidents, absorb human accidents, and go out of style. Potential buyers may be turned off by the prospect of removing carpets and uncovering the surprises that lie beneath.
If you’re faced with replacing some flooring, consider installing hardwood or tile and using area rugs for a softer look and feel. The rugs can easily be cleaned or replaced f they become stained or damaged.
17. Skylights
Skylights can let in natural light and make your home feel more open and roomy. However, there may be better choices for some homes since they can be expensive to install and difficult to maintain.
Additionally, skylights can be a liability in areas with heavy rain or snow where they are prone to leak and cause water damage. Naturally, be sure to hire a reputable contractor to ensure that the installation is done correctly.
That said, skylights are a good solution in interior rooms with no windows or large rooms with minimal natural light. We’re discussing the value of certain improvements and skylights can add net value to a home if installed in the right locations. So choose wisely, grasshopper.
18. Built-Ins
Built-ins can be a great way to add storage and functionality to your home. However, not all built-ins are created equal.
Some built-ins, such as aquariums, may decrease your home’s value. Even though an aquarium may be a unique and interesting feature, it can be expensive to maintain and viewed as a liability by potential buyers. Some buyers will picture a living room full of water.
Other, more functional built-ins like shelving and storage units are nice to have but may not add more value than they cost.
But not so fast. Some homes desperately need more storage, in which case some strategic built-ins could add more value than the cost. Plenty of houses have lingered on the market due to a lack of storage.
Bottom Line
Most home improvements are lifestyle decisions or something prospective buyers already expect, so don’t expect a return on investment beyond what was spent. Yet some are unavoidable so there’s not much choice.
The 18 home improvements we examined might make your home look and work better, but the cost will most likely exceed the added value.
Smaller, noticeable upgrades and repairs will often be worth the cost. Replacing dated light fixtures and hardware, painting unsightly areas, and moderate landscaping are examples of improvements that are usually worth the money, time, and effort.
Speak with a Bakersfield Realtor to determine what your home is worth and which improvements will pump out the best return on investment.
Property Wonk offers various client services to help navigate the Bakersfield real estate market.
Read about 14 Issues That Could Hurt Your Home’s Value
