Home improvement is the process of making changes to improve or repair an existing residential structure. These can include remodeling, additions and other alterations. Home improvements can add value to your property, increase its utility and make it more livable. However, not all home improvement projects provide the same return on investment. Some may actually decrease your home’s resale value.
Homeowners often take on home improvement projects with the intention of increasing their home’s resale value. They may think that three bathrooms are better than two, or that a new kitchen will help their home sell faster and at a higher price. However, adding amenities that aren’t suited to the general market can actually have a negative effect on resale value.
If you’re thinking about a home improvement project, it’s important to research the cost of the work and compare estimates from several contractors. It’s also a good idea to consider whether any permits are required for the work and, if so, to obtain the necessary paperwork. And, when hiring a contractor, be sure to read the contract thoroughly and ask questions. It should include a description of the work to be performed, a timeline for completion and as many specifics as possible, including types or brands of materials. It should also state that a down payment of no more than 1/3 of the contract price is to be paid upfront, and that subsequent incremental payments are to be made until work is substantially completed. Finally, it should state that final payment will be withheld until all required inspections and certificates of occupancy are provided.
You should also check whether a contract includes an arbitration clause. If it does, the parties should also agree upon a process for arbitration and any mandatory fees to be charged; whether the arbitrator’s findings will be binding; and that a claim against the contractor’s guaranty fund will be stayed until completion of the arbitration proceeding.
Fortunately, there are plenty of low cost and high value home improvements that can add value to your property. Installing a new front door or power washing your house are examples of simple projects that can give your home a facelift without breaking the bank. A well-kept lawn and shrubbery are another inexpensive way to improve your home’s curb appeal.
A well-known home improvement guru once said, “It’s not what you put into your home, it’s what you get out of it when you sell it.” While this is true, homeowners should be careful not to go overboard with their improvements. Taking on too many costly projects could actually deter potential buyers from viewing your home as an investment opportunity. Be sure to talk to a real estate agent before starting any major renovations.