April 25th, 2018 – So, lets say you are thinking of selling your home and maybe its looking tired or worn around the edges. You are wondering what renovations you could undertake now, before putting your home up for sale that would result in a net increase in the selling price of your home. There is a lot written on this subject, because it can be very complex. Is it worthwhile to spend $15,000 in improvements only to gain back an additional $12,000 in return? I don’t think so.
Lets protect your money and make this work for you!
Renovating for Yourself vs. Renovating for Sale
There is a big difference when we renovate our own home, that we plan to continue to live in for years to come and renovating as we prepare to sell the home. The former we are doing for our own comfort and pleasure, the latter for the new buyer and to maximize the selling price. Say you wanted to add a deck. For yourself you might want to use high quality clear western red cedar and perhaps a multi-level structure with captivating design. For selling, you could get away with a modest rectangular deck made from pressure treated wood. When we do it for ourselves, the renovation can use the materials and design we most like.
Etobicoke Real Estate
My practice is focused on the homeowners of Etobicoke. Properly priced homes sell rapidly here, often in one week, sometimes in a month. If it is longer than that, then there really is something wrong with the marketing approach, the price or the home. But generally, homes tend to sell quite quickly. A home staying on the market for a considerable length of time is unusual. Real Estate has fluctuated between a strong buyers’ market and a weak buyers’ market for the past decade.
Much of the original housing stock of Etobicoke was built from 1945 to 1970. In some neighbourhoods like Burnhamthorpe Gardens, Lorraine Gardens, Chestnut Hills, Glen Agar and Humber Valley many of the original homes are being torn down completely and rebuilt. So, we need to think about the expectations of the buyers of these homes.
So long as the real estate market in Etobicoke remains strong, the buyers have to be pretty accepting of whatever they find.
Last summer I had the opportunity to travel throughout Atlantic Canada. It was a tremendous trip to see a part of Canada I had never before been to. Besides relaxing and drinking the screech, I made a few observations about the real estate market there. It was quite a contrast. While Toronto real estate is driven by a massive inflow of people from around the world and a strong economy, Newfoundland experiences a net outflow of population and has a weak economy. Homes can easily sit on the market for a year or more without finding a buyer. Canadian Real Estate Association (CREA) reports there was 17.6-months of inventory on the market in Newfoundland in March 2018. That is to say at the current level of sales activity, it would take over 17-months to sell the currently listed homes, assuming no additional homes also come to market.
So, why look to Newfoundland? It lets us see the Toronto and Etobicoke market more clearly.
Newfoundland is a strong buyer’s market. Only the very nicest looking homes at the most attractive prices are the ones that are going to be sold. In Newfoundland it is critical that the home look its absolute best!
What Renovations Should You Do Prior To Selling Your Home?
The answer is very little if you can help it. Now every home is unique. What specific neighbourhood is it in? How old is the home? How well has it been maintained? Who is the expected buyer going to be?
If there is a high expectation of selling to a builder, then you sure don’t want to do very much to it.
Still, you need to get the home ready for sale. That means an extreme amount of tidying up and purging unnecessary items in the home. It means cleaning like its a hospital, especially in the kitchen and bathrooms. Cleaning the windows so the sunlight can pour in. Cleaning the years of dust in the basement. Then there is fixing all those items that have been neglected. I call these deferred maintenance: chips in the wall, dripping faucet, broken doorbell. The shingles on the roof, if they are looking very worn and curling. The furnace if it is on its last legs. Lets just put the house into good working order and looking its best.
Bringing the home up to a level of good repair, without undertaking major renovations is going to get you the best bang for your buck. Spend your time and money on cleaning and fixing what you already have before you consider undertaking renovations for somebody else. Chances are they won’t like your taste anyways and will want to rip out your work and do it again their way.
You may be able to give a more modern look to your home by changing a light fixture, replacing some wall switches or doing some painting along with some neutral decorating.
Now your home is unique and may need something different. Ralph would be happy to come and see you to discuss what needs to be done to get your home ready for sale.