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Sunday, May 1, 2011

Be smart with home improvements

Be smart with home improvements
By Jeffrey Blackwell

Watching a home improvement show on cable television can leave the impression that the best way to substantially increase the value or curb appeal of a house is by bankrolling a major renovation or addition with expensive materials and the latest gadgets.

But local real estate experts say to use caution and common sense before dropping a bundle of cash on your home because sometimes the expectations of return can be greater than the market will bear.

"All those shows were based on houses in California, Nevada, Florida," said Steven Walther, broker and owner of Steven Walther Inc. in Irondequoit. "I didn't see any of those shows focused on homes in Rochester, Buffalo or Syracuse."

Home improvement is not a cold, impersonal business decision because while a house can be an investment, it is also a roof over the head and the cradle of family life. So the lesson is about expectation — just because you invest in the dream of having a gourmet kitchen or an in-ground swimming pool does not mean it will pay dividends when the house is sold.

"If you are making improvements to a home that you plan on living in for five years or more, you will probably think about more than just your return on investment," said Leona Piro of Act Two Home Staging in Mendon.

"Convenience, pleasure, and quality of life are important considerations. However, a homeowner should be aware of certain improvements that are the least likely to increase the value of a home," she said.

Swimming pools, home theaters, high-end kitchens and bathrooms, and three-car garages might not significantly increase the selling price of a home, but they are the kind of improvements that could price a home out of what is now a very competitive market.

"Adding features above and beyond what is the norm for the neighborhood are not smart investments," Piro said.

People who are trying to prepare their homes for sale should keep in mind a couple of thoughts about homebuyers, especially first-time homebuyers:

First, they are going to be attracted to a home that catches the eye from the street.

Second, they are going to be interested in homes with updated mechanics such as the roof, furnace, air-conditioning, electrical and windows.

With down payments, closing costs, moving and other expenses, the last thing a buyer wants or can afford to do is replace a roof or a furnace, Walther said. A house can have a dazzling new kitchen, but if the major mechanics of the home are old and worn, people will most likely move on to the next property on their list.

"Somebody puts in a $40,000 kitchen, but still has original bathroom, the roof is older and the furnace is 20 years old. It's the overall functionality of the house and the neighborhood that is going to sell the house," Walther said. "The seller may have been better off spending $20,000 in the kitchen and $10,000 on a new roof. It's the overall package that makes a difference."

But, in reality, spending a lot of money on a house to make it stand out in the market isn't necessary. Buyers are looking at the neighborhood, the condition of the home. There is a great deal that can be accomplished with just sprucing up a home to attract buyers.

Greg Crandall, an associate broker with ReMax Plus in Rochester, said getting a house ready for sale can be as simple as fresh paint.

"My recommendation to start prepping a house for sale involves cost-efficient upgrades such as painting, carpet upgrades, a kitchen you are more looking to give it a facelift as opposed to a complete remodel," he said.

Jeanne Olson, branch manager for Hunt Real Estate ERA Columbus Division in Rochester, said two places that sellers can focus their investment are the bathrooms and kitchen. She suggested there are alternatives to spending a bundle on a massive renovation project, such as painting cabinets instead of replacing them, updating hardware and fixtures.

Olson, who teaches home staging classes for the Greater Rochester Association of Realtors, said that freshening the exterior of a home is also a smart investment.

"Getting the shrubs all nicely trimmed with fresh mulch and with a little color added to the front of the house," she said.

"It's kind of like dating, you see somebody across the room that you can fall madly in love with on the outside, you might not like them on the inside, but you walked over there to meet them to ask them on a date."

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