Buyers are gravitating to home listings that have already been completely updated with TV show new kitchen and bath remodel trends. These homes draw herds of buyers right out of the gate and sell within days – or hours. However, if a buyer views homes in my market, about 75 percent of listings (excluding new builds) have not had updates. Most have oak kitchen and bath cabinets, 4×4/6×6 tile in the baths and gold/silver framed shower doors.
Homes that have not been updated may sit on the market much longer than those renovated. Buyers may be using all of their cash to purchase at the top of their price range so they cannot afford to update. Sellers may be too cash/credit poor to do updates or they are knowledgeable about cost and return on investment. Why would a real life seller make on trench updates to his house only to get 50-80 percent ROI?
I love the show Property Brothers Buying and Selling, but if they were to come to my house and tell me to spend $20k-$80k to update my house just to sell it, I might kick them out. Viewers only see the success stories, so how many are fails? The brothers cannot guarantee that I will make a profit or get 100 percent return, and neither could any other contractor. However, I like to watch the beginning of the show to see the before, and then the last 10 minutes of the show for the after to see what buyers are expecting for new trends.
If I put a house on the market with kitchen and baths that are 25+ years old in my market, buyers may visit due to my awesome photography and marketing, but buyers don’t often stay. They are looking for the HGTV home that they see on television and expect to find it for these skyrocketing prices.
What are buyers hoping to see? They hope for new dark chocolate, gray, or white kitchen cabinets, stainless steel appliances, newer bathrooms with trendy 12×24 tiles, frameless shower doors, dark wood floors or new carpet, finished basements and newer roofs.
The biggest places spend updating dollars are kitchens (no more oak finish cabinets), baths and roofs. I just refinished my master bath for $4,500 and I know I will get that back. If I spend $10k-$20k on my kitchen, I will get it back. Flippers know to spend very low double digits on these rooms so there is no sunk costs. If I have a finished basement with a wet bar and a full bath, I have a golden ticket – this is the age of extended families and returning college kids. (I do not recommend that you finish your basement just to sell – that spent $40k may net only $15k-$20k on a bank appraisal.)
If your home is not updated, be prepared to get a lower price, but don’t despair because there are buyers for every home, especially now as we continue our extreme inventory shortage.
Ruth Ann Berklich
Realtor with Real Estate One, Rochester Michigan
Facebook: Ruth Berklich Real Estate One