How Repairs Can Affect Your Home’s Value
If you are getting ready to sell your home, the first thing to think about is the condition of your home. Ideally, your home has been recently built or has been remodeled, so that repairs won’t be an issue.
What if this is not the case? What if it’s determined that the home needs one or more repairs. What are your options?
There are two levels of repairs. Level 1 is when the kitchen or bathrooms are outdated. Level 2 is when the roof needs to be replaced or there are foundation issues.
How does this change how we sell your home?
Level 2 repairs are crucial because it can mean the difference between a buyer getting the loan approved to purchase your home or not. In many cases, a lender will not fund a home with roof or foundation issues. You don’t want to find this out 3 weeks into a contract with a buyer.
Level 1 repairs are not necessary. It may just mean you need to lower the listing price of your home. This will also be affected by the comparable properties in your neighborhood.
Why is listing your home for the right price so important?
In the Dallas, Texas area, there are plenty of interested home buyers ready to make their next purchase. If a property is priced right, it will get the showings necessary to receive a good offer.
When an offer is made, and an appraiser comes out to your property, they will take all similar homes in your neighborhood that have sold in the last 6 months into account. By similar, we mean year built, approx. square footage, lot size, etc.. This is important because you need the appraisal to come in at the agreed-upon contract price for the buyer to get the loan fully funded.
Let’s say there have been 6 home sales in your neighborhood, with sale prices ranging from $262 K to $294 K. Two of the homes have had no renovations, two of the homes have had some remodeling but have carpet throughout, and another two have been completed remodeled and have hardwood floors throughout, updated bathrooms and kitchens, and a great open concept.
Your home, which has had some remodeling done, would fall in the mid-range priced around $278 K. Some purchases such as a new HVAC could help bring up that value.
Working with an experienced real estate broker, like myself, can ensure that you are doing inexpensive repairs and pricing your home appropriately to avoid low buyers offers and high Days on Market.
If you are unsure if you should make certain repairs on your home before listing it on the market, give us a call. As an experienced broker and investor, I can help you determine what would add value and where you should save. Schedule an appointment today so you can get started months before you want to list for sale.