In today's turbulent real estate market, selling a house has become much more complicated than just putting up a for sale sign. Earlier this year, my family and I chose to sell the home we'd lived in for the past seven years. As a college student a couple years into my studies at the University of Washington, I decided that it would be best for us to downgrade to a smaller house, with me out of the house. I discovered that there was far more to selling the house than just selling the house; judgment calls had to be made, investments with no guaranteed payoff had to be considered. It was a turbulent experience, but in retrospect there are a few simple concepts that, if followed from the beginning, would have made my experience much easier.
Nowadays a practice that is always considered when it comes to selling a home is the idea of making improvements to the house to help it sell faster, for a better price, or just sell in the first place. While this sounds like a very lucrative idea to some, in my experience there are some important limits to keep in mind when considering upgrades. If you're trying to purchase improvements for the house in order to raise the price by more than you paid for the improvements, forget it. By its very nature this tactic is doomed to failure unless you manage to cheat your buyer, because the amount the improvements will raise the value of the house is defined by exactly how much they cost; thus if your buyer is good at gauging prices you will rarely be able to make money in this way. The effective way to apply this concept is by changing the impression you make on your buyer when they consider the house, not their perception of its financial value.
Take the house I sold, for example. In trying to sell the house initially I found that nobody would even consider buying it for what I had calculated to be its real market value, at least not after they saw it. This is when I began to consider home improvement to boost its perceived value. The house had a number of places it could be effectively improved: the flooring was old, the kitchen was dated and looked worn, and the bathrooms could've used a remodel. But all of those things were expensive, and none seemed like it would dramatically improve the value of the house or the way prospective buyers looked at the house.
What I ended up doing was repainting the front of the house and the front door, where the paint was beginning to peel. I also planted a few cheap new potted plants besides the driveway. These steps took very little effort and money, but it completely changed the first impression the house made, and the way a visitor looked at the rest of the house. By the end of the upgrading process, I did not have to hire a single contractor; the only expenses were several hours of my own work along with less than $500 of supplies.
The next prospective buyer to view the house purchased it, a month after I repainted. It may sound like very little, but first impressions are everything, and absolutely necessary in today's market.
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