By Melissa Dittmann Tracey, REALTOR® Magazine
Remodeling a kitchen, bathroom, or other room to increase a home's value can be a good idea, but home owners need to be careful when undergoing a remodeling task to ensure they don’t fall for some of the common traps. CNNMoney.com recently highlighted a few such common mistakes:
1. Being too trendy. The home will look out-of-date a lot faster if you just reach for today’s trends, according to design experts. As such, you might want to bypass such trends as glass tiles, wire-hung track lighting, and vessel sinks, says Curt Schultz, a real estate professional and architect in Pasadena, Calif. Instead, opt for classic choices that compliment the home’s original style, he says.
2. Going overboard in the kitchen. Kitchens can help sell houses but that doesn’t give you a green-light to spend big bucks in giving it a total redo. You still want to be practical, or you likely won’t recoup the cost of all your upgrades when selling. The kitchen usually makes up 5 percent to 15 percent of a home's value so limit your kitchen remodeling budget to that range, says John Bredemeyer with the Appraisal Institute. And don’t gut the kitchen if it’s already in good shape, he adds.
3. Assuming “green” always will net you a big return. You’ve heard a lot of buzz about going green and increasing the energy efficiency of a home. Certainly, home buyers have said in recent surveys that they want more energy efficiency upgrades, but when selling a home, you won’t always see a payback in the sale if you opt for a bunch of costly “green” updates. For example, swapping out old windows--estimated at about $300 to $1,200 each--may save you $50 to $175 a year on your energy bills, but your installation investment and savings might not necessarily be made up at resale.
So you'll likely want to keep the potential paypack in perspective when doing any remodeling so you can judge if it's really worth it--that is, if you're looking for a return at resale. You might just want fancy windows and countertops.