As a homeowner you know that the best way to protect your home’s value is by maintaining it. And, when it comes time to sell it, you’ll find lots of ways to increase its value.
On the flip side, there are few folks willing to tell you how to wreck your home’s value. Until you met us, that is.
Use this list of tips as a cautionary tale – unless, of course, you really want a decrease in value.
1. Convert your garage
More than half of homebuyers want a 2-car garage and 86 percent want a garage with storage, according to a survey conducted the National Association of Homebuilders.
So, although you may think of yours as wasted space or just an oversized junk drawer, carefully consider what a garage conversion can do to your home’s value.
A Sacramento appraiser found that homebuyers paid between 6 and 10 percent less on homes with no garage, regardless of what replaced it.
On a $200,000 home, that’s a loss of between $15,000 and $20,000.
Here in Nashville, we have experienced this first hand. We typically have a much harder time selling a home with no garage. Additionally, areas where parking is sparse such as Lockeland Springs, 12 South, or even Hillsboro Village buyer will pay a premium for a detached garage. Appraisers will even give more value consideration towards a garage in some of these areas.
If you are thinking of selling the home, consider some garage upgrades that may increase its value and make it more attractive to homebuyers. These include:
- A new garage door. According to Remodeling Magazine’s “Cost vs. Value” report, homeowners who installed a new garage door saw a 98.3 percent return on their investment. You can even make minor improvements to your existing door by adding magnet style hardware or faux windows.
- Adding additional storage options, such as shelves and cabinets. Consider overhead storage, suspended from the ceiling, to utilize the wasted space above the cars. It’s quite popular and will catch a buyer’s eye.
- Make the garage look brand new by power-washing the floor and applying an epoxy floor coating (This Old House offers a walk-through of the process). Then, paint the walls with a semi-gloss paint. If your garage floor has oil stains, here is a great article from Tips Bulletin on how to remove those stains: https://www.tipsbulletin.com/how-to-remove-oil-stains-from-concrete/
2. Don’t snitch to the HOA about bad neighbors
If your community is governed by a homeowners association, you pay dues. Even homeowners with low fees should expect their association to enforce its rules and regulations.
To not take advantage of their power when a neighbor is messing with your home’s value is just not smart. Consider becoming a “snitch” if any of the following occur in your neighborhood:
- The hoarder: Nearby property that is cluttered with a homeowner’s junk can reduce your home’s value by 5 to 10 percent, according to the Appraisal Institute. If the exterior is extra-packed with debris, you may lose even more value.
- The loud neighbor: Most associations have a noise ordinance in their rules, and for good reason. Not only are loud neighbors disruptive to other residents, but their (and their pets’) noise can reduce home values by another 5 to 10 percent.
- Unsightly vehicles: Many HOAs prohibit residents from parking commercial vehicles, boats and large recreational vehicles on the property. If yours does, and a neighbor is violating the policy, contact your HOA and file a complaint.
3. Install a pool
In some parts of the country, such as Las Vegas and parts of Arizona, a pool adds value to a home. It may also add value if you live in a neighborhood where most of the other homes have pools.
However in the greater Nashville area, a pool will not add much value. I personally have an inground pool at my house, and when we purchased our home, the Nashville apraiser only gave the pool a value of $10,000 (far less than what it would could to install a new pool unit). Sometimes, a pool is considered an expensive inconvenience and a liability and can drag down the value of your home.
Not only that, but a pool knocks some buyers out of contention. Unless it offers security features, the pool won’t be popular with families with young children.
Consider that the average cost for a complete pool installation will cost between $30,000 and $100,000 according to Jean Folger at Investopedia.com.
Then, in some states and municipalities, fences around the water feature are mandatory, so factor in that cost. Find out if yours is among them at signs.com. Most Nashville homeowner’s insurance companies will require you to add fencing around the pool (or at least decrease your premium if you install a fence around the pool to decrease the chance of a child or pet accidentally falling in.
Ongoing maintenance may cost a bundle as well. “The pump and heater, if you have one, could drive up your utility costs by $100 a month or so,” according to the folks at daveramsey.com.
“You’ll spend about $600 during the swimming season on chemicals if you maintain your pool yourself. If you live in a climate where you’ll use the pool year-round, budget $15–25 a week for DIY maintenance,” they continue. Additionally, your electric bill will also be higher. I’ve personally noticed that our home’s electric bill runs about $100 higher during pool season (due to the pool pump).
If you must install a pool for your own enjoyment, keep in mind that it won’t pay for itself when you sell the home and you’ll likely take a hit on your home’s value. For my family, we really wanted a pool, so we purposely looked for only homes with pools when we made our home purchase. All in all, it’s a smart way to go because you essentially are not paying retail value for the pool when it’s already included with the home sale.
No, these aren’t the only things that negatively impact a home’s value. Many of the others are out of your control. For those issues that are within your control, act on them.
Speak up and protect your investment when the airport decides to change flight paths, when something negative is about to impact the quality of your local school and when value-killing zoning changes are afoot.