Homes that advertised higher-end kitchen and bathroom amenities sold for more than otherwise expected in 2020.
Self-admitted fixer-uppers sold for almost 13% less than expected.
Many higher-end, custom home features are associated with slower sales.
Collectively, Americans spent a lot more time at home last year cooking, eating and, well, taking care of post-meal business. Perhaps not coincidentally, features related to high-end kitchens and luxurious bathrooms frequently appeared in the online listing descriptions of homes that ended up selling for more money than otherwise expected.
To determine the price premium associated with certain features, Zillow analyzed closed home sales in the United States in 2019 and 2020 where we could match the sale to the listing description and the home's Zestimate in the month before listing. Six out of the top 10 features mentioned in listings that sold for more than expected in 2020 are kitchen-related, two are related to bathrooms and one — "modern farmhouse" — could reasonably apply to both (assuming "modern" does not imply an outhouse situation).
For the true gourmands, or those aspiring to become one, listings that mentioned steam ovens topped the list for sale price premiums, selling for about 4.9% more than expected. Pizza ovens (3.4%), new appliances (3.2%), quartz (3.2%) — as in countertops, which could also be found in bathrooms — smart appliances (3.0%) and butcher blocks (2.7%) all made their way into the top 10 listing terms in terms of sale price premiums.
Outside the kitchen, listings that mentioned "curbless" — for showers flush with the bathroom floor — fetched 3.6% more. "Modern farmhouse" styles also brought in about 3.6% more than expected, and heated floors or radiant heat — to warm your feet on a cold bathroom floor — were associated with a 3.2% sale price premium.
At the other end of the spectrum, self-described fixer-upper homes fetched 12.9% less than expected; those that admitted needing some "TLC" brought in 11.1% less; and ones marketed for their "investment" prospects sold for 4.5% less than expected.
And while 2020 also brought a wave of newly-adopted pandemic pets, and despite the premium associated with "dog house," "pet-friendly" listings experienced a 2.2% discount. "Bike parking" was associated with a 2% negative premium. This could be because these features were correlated with small indoor spaces in large multifamily buildings, which otherwise underperformed larger single-family homes in 2020.
Correlation, NOT Causation
Now, before we go any further, here's a critical note that we always include with our sale price premium analysis: Adding these design features to a home, or just adding these words to a for-sale listing description, does NOT guarantee or definitively cause the ultimate sale price to increase (or fall) as much as observed. Rather, the most likely explanation for these results is that for-sale homes with these kinds of features in their descriptions may be of generally higher quality all around (or are at least perceived to be), in ways that are difficult to observe or quantify but which tend to lead to a higher final sale price. Essentially, the whole of a home can often amount to more than the sum of its explicitly advertised individual parts, and a home's overall perception of "niceness" – and the price premium that comes with it – seems associated at least in part with the presence of these currently popular features.
But that doesn't mean this information isn't valuable to sellers determining how to market their homes and/or buyers determining the right offer – it certainly is!
From a buyer's perspective, the features present in a home and/or the choices made to advertise said features in a listing description are indicators that a home may be perceived as cutting-edge and/or well-updated. And buyers actively seeking those traits in a home from the moment they move in may be willing to pay more for them when making an offer. But for bargain-hunting buyers or those with different tastes, the presence of such features may be a warning that they could end up overpaying for a prior renovation that doesn't suit them or for features they don't want/need.
From a seller's perspective, there's a clear takeaway: If you've got these features in your home, don't hide them from buyers! And if your home doesn't have these features, don't pretend it does. But because we can't prove causality behind these relationships, it remains unclear if that steam oven will really move the sale price needle so dramatically – much less whether any gains would outweigh the costs of installing one and throwing out the old stove.
Going…. Going… Gone
Beyond a higher price, many sellers are also interested in a faster sale. Homes advertising "drought-resistant" plantings or yards sold 13.2 days faster than expected for homes in their price range. Other features common to quick-selling homes include "bohemian" or "boho" design (11.0 days), turf (10.9 days), mid-century style homes (9.0 days) and smart sprinkler systems (7.5 days). The bohemian design trend seemed to hit on a listing description sweet spot in 2020: In addition to selling quickly, homes described this way also sold for a solid 2.3% sale premium.
The features mentioned in slower-selling properties did not fit a common theme this year, although past research shows that higher-end, custom homes tend to take longer to sell in general. The slowest-selling homes were ones that mentioned "wellness" – usually wellness rooms – which sold 11.8 days slower than expected; bidets (11.2 days); professional appliances (10.7 days); energy-efficient appliances (10.1 days); and bike storage or hooks (9.4 days).
Approximately 1.4 million home sales from 2020 were analyzed. In each case, the listing description on Zillow was flagged for whether it contained any variation of each of 221 common expressions of interest. The logged final sale price (or days on Zillow) was regressed against the logged pre-listing Zestimate, which represented Zillow's best guess of how much it would sell for when listed, as well as (simultaneously) the presence or absence of every one of these 221 listing description features. Only results for features with a statistically significant coefficient and which appeared in at least 100 listing descriptions are reported here.
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