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Today’s post, “Five Home Upgrades Almost Guaranteed to Lose Money,” was contributed by Anum Yoon, the founder and editor of Current on Currency, a site devoted making personal finance more approachable for 20 somethings and international students.
Five Home Upgrades Almost Guaranteed to Lose Money
Just because you upgrade your home doesn’t mean you will get a higher selling price, because not all upgrades and home improvements are worth the investment. You may be surprised to learn some of the home upgrades you should forget about, including these five.
Adding a Pool or Hot Tub
You may think adding a pool or hot tub would greatly increase the value of your home, but that is not true. Why? Pools and hot tubs are expensive to maintain, they raise taxes and, if problems arise, the cost to fix them can be enormous. You should also consider the impact it can have on homeowners insurance.
To some buyers, the pool is seen as a liability because accidental drowning is a common problem and can be a safety issue for families with children.
Outrageous Color Choices
Just because you like purple walls or a bird mural on the ceiling doesn’t mean potential buyers will. While it’s fine to add a fresh coat of paint to increase your home’s appeal, it is not a good idea to use unusual colors or customize to match your unique style.
Though the new owner can make changes, potential buyers would rather buy a home that doesn’t have to be changed right away. Choose neutral colors to paint rooms and ordinary design schemes. This way the potential buyer can take their time in repainting, not forced to cover up something that doesn’t suit their tastes at all.
Converting Rooms Into New Functions
Room conversion is a home upgrade that doesn’t always pay off. For example, it may seem like a great idea to convert your garage into a den or a small bedroom into a home office or walk-in closet, but these improvements aren’t always the best decision.
Making changes like these can actually reduce the value of your home. Consider the neighborhood and the size of your home. Would a bedroom be more practical than a walk-in closet? Most likely the answer is yes. In most cases, room conversions and luxury home upgrades are a just a bad idea.
Major Landscape Upgrades
You may think bigger is better, but that’s not always the case when it comes to outdoor landscaping. Creating a backyard oasis complete with pond or gazebo sounds nice, but it’s costly and usually doesn’t add any value to your home.
If you want to spruce up the backyard or front walkway, that’s fine. You can add more value for less cost by planting flowers or bushes near the entryway or investing in lawn maintenance to ensure your grass is green and inviting.
Adding a Deck or Sunroom
Sunrooms and decks can be a fun gathering place, but they are not always a smart investment. It costs nearly $80,000 for the average sunroom addition, for example, and you get barely half that back in value. Decks are also costly and add little value to the home.
These two projects require a lot of materials, labor and other costs to complete. They also need upkeep, which some potential buyers may not want to burden themselves with.
Home Upgrades Worth Pursuing
While this list may surprise you, keep in mind this general theme: when it comes to home upgrades, overdoing anything is not a good idea. The best improvements for the home are those that add value, such as improving efficiency and fixing problems that may lead to costly repairs later.
Simple improvements, such as adding fresh paint and improving the look of the home outside, are your best way to go. Don’t go overboard and try to make your home into a showplace.
Instead, focus on creating a clean, uncluttered inviting home. Keep upgrades standard and simple. This way, you can be confident that your chosen home upgrades will be a wise investment for years to come.
Anum Yoon is a millennial money expert and runs Current on Currency. Sign up for her weekly money newsletter here if you want to read more of her posts!
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Emily @ JohnJaneDoe saysJune 21, 2017 at 7:27 AM
Interesting, and I would not have guessed about the deck, although most of the others make a ton of sense. Of course, elaborate landscaping, pools, and sunrooms are all things people do to make the house fit them better. If your purpose is not to add value to your home but add value to your life at home, the calculation is a bit different.
(Hubby and I have a running disagreement about painting the kitchen. But since we don’t plan on moving, I think it’s a moot point if it’s yellow instead of cream.)
Hero saysJune 21, 2017 at 9:33 AM
You raise a really important point, Emily. Many things we do in life – not just home renovations – might appear to be “losing money,” but if they add value to your life, it’s a good trade. After all, money isn’t the only currency we deal with in life.
Mrs. Picky Pincher saysJune 21, 2017 at 8:00 AM
When we bought our house, the knuckleheads who owned it before us had painted one room LIME GREEN from literally floor to ceiling. It was such a shock that we nearly didn’t buy the house. Fortunately paint is a relatively easy thing to fix, so it wasn’t a big deal.
But the best upgrades you can do to a home are upgrading the kitchens and bathrooms TASTEFULLY. No coral tile, y’all.
Hero saysJune 21, 2017 at 9:35 AM
Oh man, I would love to see pictures of that lime green!
A few months ago I was showing a home to some of my clients and we discovered the basement bathroom had been decorated with a full force Batman theme: yellow and black tile, paintings of Batman directly on the drywall, a black sink, and a yellow toilet. I bet that house is still on the market!