Four Surprisingly Common Things That Can Decrease The Value of Your Home
If you’re an investor or a homeowner looking to sell your property, you’re likely paying close attention to all the things that affect your home’s value. The factors that affect a home’s value are wide and varied: everything, from school district performance to property taxes to surrounding area home values to the upkeep on adjacent properties, plays a role.
However, there are some factors that many homeowners don’t consider, but that doesn’t mean they can’t measurably impact a home’s value.
There are some things within your control as a homeowner, while others are external factors. You may be able to renovate the kitchen, but you probably can’t do much about the local school district. The former is something you can take care of when it’s time to sell, while the latter is something you want to be aware of before you buy in case you may want to sell one day.
So we’ve compiled a short list of common things that can affect your home’s value but often slip under the radar as buyers and sellers understandably fret over more visible circumstances. Do your due diligence, by all means, but don’t forget about these:
Is there a HOA, and are their fees high or covenants restrictive?
This is something for both buyers and sellers to keep in mind. While homeowner associations can actually help maintain the property values of its members, sometimes they can be undesirable to buyers (which affects their chances of selling the home they’re interested in should they want to in the future).
Even though some HOA’s can be beneficial, sometimes the expense of high fees or the hassle of annoyingly restrictive covenants, like fines for leaving trashcans at the curb past a certain hour, can make a home less worthwhile for a buyer.
The Internet has no shortage of HOA horror stories, and we all have at least one friend who’s been through the ringer with a HOA. That’s not to say all HOA’s are awful, but the stigma is there and even if yours is great, a prospective buyer may subconsciously remember the time their father-in-law battled with his HOA and subsequently decide not to purchase your home.
If you’re selling, you may need to factor in the belligerence or inconvenience of your HOA into your price (or at least not be surprised if lower offers result). If you’re a buyer, consider the eyeroll you just did when you heard about this HOA and how other prospective buyers may react in the future should you want to sell the home you’re considering buying.
So you replaced your appliances. Great! If you purchased them from several different brands, though, it could inconvenience a new owner.
Moving on to things a seller can control, we always say a seller or an investor can do a whole lot worse for themselves than purchase new appliances before selling. It’s a good thing to replace your almond-colored washer or yellowed refrigerator from the 70’s, since shiny new appliances always catch a buyer’s eye and increase your home’s appeal in a big way.
Still, part of that appeal is assuring the buyer of a reasonable amount of convenience after they purchase the home because they know they have new, functioning appliances to use for several years. Don’t undermine that convenience by stacking your home with a variety bag of brands in terms of appliances.
The reason for this is, should multiple appliances break or require under-warranty service (especially if it’s for a large-scale isolated event, like an insurance or damage claim), a buyer is going to be inconvenienced by tracking down customer support for several different brands.
It’s fine to have your laundry appliances be from different brands than those in the kitchen, but realistically you shouldn’t mix and match too much more than that. Plus, the aesthetic appeal of matching appliances in a crucial area like the kitchen won’t be lost on buyers. You may not be able to do quite as much bargain hunting this way, but if you were going to spend the money to replace appliances anyway, you’ll gain the greatest effect by going with one brand.
Is the design and color scheme of the house sensible and consistent? Remember, clashing colors can turn off buyers, even subconsciously.
If you have a seller’s agent, this is one of the first things they’ll point to when you’re staging your home, but it’s amazing how many homeowners and investors overlook continuity between the aesthetics of each room in a house.
It makes a difference. When you live there and aren’t planning to sell, then a bright blue nursery for your newborn or a bold color in your teenager’s bedroom isn’t the biggest deal. Once you decide to list, though, you may want to consider repainting and unifying the theme of the home so prospective buyers have an easier time envisioning themselves living in the house.
This isn’t something to gloss over (pun not intended?). While you should probably apply a fresh coat of paint all around the house anyway, take care to get rid of any clashing colors and stick to neutral tones if you can. You want a potential buyer to have a blank slate and be able to imagine living in the home. Bold colors have a narrower appeal, and you want to cater to the widest possible range of tastes. Neutral tones are a good way to do that.
Even if you don’t have a poorly executed bright orange bathroom that you were sure you could pull off after you saw it on HGTV, muted colors that don’t match or flow well together from one room to the next can have a subtly stressful effect on visitors. Buying a home, to some extent, involves emotion on the buyer’s part; more than one potential buyer passed up a home because it “just wasn’t ‘the one.’” Even the slightest bit of stress to a buyer’s eye or sense of aesthetics is more than enough to cause them to move on.
Are any renovations properly done and in good repair?
If you made renovations to your home prior to selling, even several years ago, that’s in theory a great thing. New kitchens, renovated bathrooms, and added decks are all highly appealing to buyers.
The kicker is that they need to be properly done, visually appealing, functional (and safe!), and in good repair. Otherwise, they may actually decrease your home’s appeal to buyers. A new kitchen with granite counter tops is going to catch more than a few eyes. On the other hand, don’t assume that hastily done conversion of your carport into a sunroom will automatically add value to your home.
In both cases, you should think more in terms of how any renovations add to the functionality and aesthetic of your home, and by extension it’s appeal to buyers, rather than strictly hoping for a return on an investment just because you made one. The market, quite honestly, doesn’t care what you spent on your deck. All that matters is what appeals to buyers.
You can gauge this to some degree by looking at real estate studies and listings in your area, but a good rule of thumb is that more square footage doesn’t necessarily mean more value, so keep that in mind before converting your garage into a den.
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- Get It Right Solutions