This is great for the long-term buyer looking to lay down permanent roots in the home of their dreams. However, for the buyer with a shorter timeline, new home personalization means choosing options that will generate greater resale value.
But how does one plan their options budget for future buyers and the promise of appreciation? Let’s take a look:
The most crucial part of options selection, for any buyer, is establishing a budget. However, when it comes to selecting options for resale value, budgeting becomes increasingly important as there is risk involved.
“A buyer should attempt to determine how long he/she will be in the house,” says Sandra Woncheck, a real estate agent with Berkshire Hathaway HomeServices in Pittsburgh, Penn. Then, with the help of a real estate professional, buyers should look at the market trends to determine what the home’s increase in value might be for their location. Using this as a guideline, a buyer can then determine how much to put into the home without going overboard, she says.
However, it’s important to be realistic about the amount of time a buyer will really be in the home, says Ron Rovtar, a Realtor with Cherry Creek Properties in Boulder, Colo. “Basing decisions on resale value will probably mean little for those who plan to stay put for 15 or 20 years. Resale is a much more important factor for owners who will live in the house three to seven years.”
But surprisingly, it’s not upgrades that make the biggest difference in a home’s resale value. “Few upgrades really pay for themselves when selling,” says Rovtar.
It’s actually location that matters most. “If a buyer goes overboard on upgrades, they run the risk of making their home the most expensive, and, therefore, the most uncompetitive and unsaleable in the neighborhood,” says Woncheck.
Thus, when selecting options it’s also important to consider what will bring about personal satisfaction. “In a sense, you need to add the two factors together: added value when selling plus high personal satisfaction equal a good decision,” says Rovtar.
Most people don’t think about space as an option, but it’s a huge asset, as it’s one of the most difficult and expensive to change later on.
“Things like fixtures and finishes can be changed out easily years down the road, but you only get one shot to make the interior space of the house exactly how you want it,” says Ryan Thewes, an architect in Nashville, Tenn. Consider adding square footage or bonus rooms or opt for structural features like bay windows and fireplaces that can add resale value.
But more than investing in space itself is the quality and type of a space. For example, consider the benefits of informal, open layouts versus formal, private spaces. Also consider the quality of materials such as hardwood floors versus linoleum.
“I think that investing in the quality of space has the biggest return in regard to resale. I have noticed that a lot of homeowners like to come in and make cosmetic changes when buying a home anyway,” says Thewes. “So spending money on fixtures or lighting might not be the best way to go. Focus more in permanent things like the flooring or countertops, things that are not as easy to replace,” says Thewes.
As far as critical spaces in a home, “a buyer should sink most of their options budget into the kitchen and master bath,” says Rovtar. Not only do these rooms have the most influence over a buyer’s impression of the home, but they are also very difficult to renovate.
Last, but not least are standard options offered to all new home buyers (flooring, fixtures and lighting, finishes, cabinets and countertops). “If sellers want to get top dollar, they must acknowledge that buyers are expecting to find hardwood flooring, granite countertops, solid cabinetry, recessed lighting, quality hardware ceramic tile, fireplaces and top of the line appliances,” says Woncheck.
Keep in mind, however, that your home needs to be ultimately palatable to a wide, unknown audience. Take pains to keep things classic and simple and not overly stylized, as this can dramatically limit your buying pool. “Keeping permanent finishes neutral in color, such as countertops and tiles, is important,” says Woncheck.
Also remember that you don’t have to re-invent the wheel. You’re not the first person to do this and there’s a lot to be gained from the recommendations of design professionals, says Woncheck. “Personal design touches can be achieved through paint and accessories, both less permanent.
In choosing options, don’t forget the unseen things. “Something like spending a little extra money for geothermal heating over a conventional HVAC system will save on utility bills and also make your house more marketable for the future,” says Thewes. Many investments in the areas of energy efficiency, durability and ongoing maintenance are a valuable resale asset that are often overlooked.
Lastly, lifestyle issues are also important considerations. “A buyer should visualize how they will live in the space and then determine if those issues might be important to the next homeowner,” says Woncheck. For instance, a buyer may want to add a grab bar in the bathroom, additional storage in the kitchen or more outlets for charging electronic devices.
For the buyer looking to sell their new home in the near future, it’s possible to select options for increased resale value. Setting a budget based on market projections, investing in structure and more permanent home features such as flooring or countertops can insure your home against major price cuts in years to come.
Ashley Steel is a former SEO analyst for Builders Digital Experience (BDX).
She was previously a staff writer and editor for New Home Source, where she wrote about a variety of topics, from helping Realtors understand how to assist clients in choosing new home options to helping consumers find home design inspiration in a variety of places including a chic industrial-style bar to chicken coops.
Steel is a 2013 graduate of the University of Texas at Austin with a double major in Latin American Studies and Spanish. Previous to joining BDX, she worked with Latinitas, a nonprofit group that aims to encourage Latino youth to explore the fields of media and technology.