For some people, home renovations are purely a business proposition. Maybe they’re trying to “flip” a house, or maybe they’re simply interested in selling soon. Maybe they want to increase market value or appeal. Maybe refinancing the home is part of the equation. There are many “businesslike’ reasons for embarking on a home renovation project.
On the other hand, there are so many homeowners out there for whom renovations are all about making dreams into reality. Maybe it’s that beautiful, spacious kitchen you’ve always wanted. Maybe it’s that makeover you’ve always wanted to give your bathrooms. Maybe it’s a whole new addition that gives your home significantly more square footage and space.
Whatever your reasons for home renovation, you generally want your property value to at least stay the same. People who go into home renovation expecting massive returns and skyrocketing property values as a result of the work they’ve done are likely to be disappointed when reality strikes. But if your expectations are realistic and informed by actual market analysis and feedback from experts, you’re more likely to be pleased with the overall results — including the effect on property value.
But can home renovations actually decrease your market value? If so, what are the specific situations in which this commonly occurs?
The short answer is yes — there are renovation projects that can decrease your home’s market value. But it really depends on your neighborhood, as well as local and national real estate trends.
For example, buyers today are generally moving away from the idea of a huge master suite that takes up valuable square footage. If you knock out a wall to create a bigger master suite (or if you remove a smaller bedroom to create a more open living plan), you could put a dent in your property value. If you turn the garage into a living space, you’ll turn off the huge percentage of home buyers (something like 75%) who definitely want a garage.
Another thing to watch out for are renovation trends that are here today and gone tomorrow. It’s important to choose your materials carefully during kitchen renovation planning, for example. Consider all the options, how long they’ve been around, and what home renovation experts consider to be the best long-term approach. There are always trends and fads out there that can lose you money (or property value) if you’re not careful.
Where dreams and expectations meet
The best home renovators understand that people have all kinds of reasons for renovating their homes. The advice given by professionals will always be tailored to the specific goals and tastes of a particular homeowner and their particular home. No two projects are exactly alike. Since home renovation can take basically any form (as long as it conforms to applicable laws and building codes), there are certainly renovation ideas that could harm your property value. But if you’re paying close attention to market trends and what other homeowners are doing — and if you proceed with caution when it comes to current renovation “trends” — your property values are likely to be impacted in a positive way. Especially if you collect advice from reputable home renovation companies before proceeding with your project.