What's the Joke About All Home Improvements?

by Pool Builders on 03-28-2012 in Articles

The joke about all home improvements is that you never know if they will increase your home value, decrease your home value or keep your home value stable. If home prices are falling at a rate of 6% and you update your kitchen, you may prevent the value of your home from decreasing in value even further, because the updated kitchen will add enough value and offset the declining prices of real estate.

You just don't know. In fact an appraiser does not know until they review the sales, active listings and pending sales in your market area. This is because home prices, homes sales and listings change every day of the week. Some buyers' in your market may be more desperate to sell their home. Some buyers will list their home too high and their home will never sell. Other times of the year, these same homes will sell. In my market, some areas were declining at a rate of 10% or more, so no matter what you did to your home, you will lose money if you sell during this time.

The cost of the improvement will cost you money and the declining market conditions will cost you more money. In this situation, you may be better off not selling, if you have a choice.

If you make the incorrect improvements, the value of your home will surely not increase. I just read an article on-line that stated that an in-ground swimming pool is always a good investment, Ha-ha. I agree that if the swimming pool is well cared for and clean and looks good, this may appeal to many buyers, however, what happens if the buyer does not want to maintain a swimming pool or the children don't know how to swim, so it is a safety hazard. What happens if the in-ground swimming pool leaks and the filter is broken? Now you have a swamp infested leaking pool that will be a negative impact to buyers in your market area.

So what's the joke about all home improvements, is that you don't know what it's doing to the value regardless of statistics about how they are supposed to increase value until an appraiser reviews sales in your area. Do you know why? It is the collection of the real estate and all of the improvements and the sales in your market area that will decide and it's all time sensitive.

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