The Repairs That Will Help Sell Your House in a Cooling Market | Kanebridge News
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The Repairs That Will Help Sell Your House in a Cooling Market

More sellers are remodelling properties to avoid cutting prices, though some projects pay off more than others

By VERONICA DAGHER
Tue, Oct 11, 2022 8:52amGrey Clock 3 min

The playbook for selling a home needs a makeover, and often so do the houses.

Selling a house takes much more elbow grease than it did a year ago. Homeowners earlier could expect a bidding war the moment they staked the for-sale sign in the front yard, even if the property was in dire need of updating.

With mortgage rates now pushing 7%, buyers are harder to come by and easier to turn off, real-estate agents say. Making repairs or even small cosmetic improvements that buyers care about could make the difference between getting your asking price or giving a discount.

Between mid-July and mid-August, about 95% of home sellers made updates or repairs before listing their properties, up from 71% of sellers six to 12 months ago, according to Realtor.com. They spent an average of $14,163.

Not all renovations are worth the cost for sellers, data suggest. The top three interior remodelling projects with the highest return on investment are a hardwood-flooring refinish, new wood flooring and an insulation upgrade, according to a recent National Association of Realtors report.

Some sellers might find that smaller fixes such as a fresh paint job can make a bigger impression on buyers than pricier changes such as a renovated third bathroom, real-estate agents said.

“Sometimes, the upgrades that aren’t the sexiest pay off the most,” said Judy Dutton, executive editor at Realtor.com.

A big remodelling project, such as a new kitchen or deck, might not be worth the investment and delay a seller’s timeline, given supply and labor shortages, said Jessica Lautz, a vice president at NAR. Focus on more affordable projects that appeal to buyers and look beautiful in photos, such as refinishing hardwood floors, she said.

A hardwood-flooring refinish has a 147% cost recovery, meaning homeowners are likely to recoup well more than the cost, said Ms. Lautz. For comparison, a kitchen upgrade has a 67% cost recovery.

Consider the smaller things that are likely to turn buyers off and fix them fast. Mitigating strong odours is a relatively low-cost fix that helps sell a home, said Mark Barnes, a Realtor in Charleston, S.C.

Mr. Barnes got one client’s home a deep cleaning before showing it to potential buyers, because the scent of the owner’s dog overpowered the house.

The owner paid about $400 for the service, which included two carpet cleanings. The house sold for $475,000, about 5% over the list price, Mr. Barnes said. A deep cleaning could add $3,731 to the sale of a home, according to a recent report by HomeLight, a marketplace that connects home sellers with real-estate agents.

Enhancing curb appeal helps a home stand out to buyers and reduces seller concessions, said Darin Eppich, a Realtor in Los Angeles.

Mr. Eppich recommended his client David Garonzik resod the front lawn of a three-bedroom Woodland Hills, Calif., home as an improvement from the lawn that was dying from the drought. Mr. Garonzik considered putting in a desert landscape with rocks, but Mr. Eppich didn’t think the roughly $10,000 cost would be worth it or would seem as appealing to buyers.

Mr. Garonzik is hoping the $4,000 improvement will help him land more than the home’s $1 million asking price, though it is too soon to know whether the gambit worked.

For apartment sellers, focus on cosmetic upgrades—unless there is an apparent flaw such as a leaky faucet or nonworking appliances, said Renée Lee, a real-estate agent in New York City.

Anything that isn’t broken, is costly to replace and isn’t overtly visible, such as a new central air-conditioning system, won’t impress buyers as much as improvements they can see, such as new doors for the kitchen cabinets or customisable closet shelves, she said. Aim to fix anything that an inspection would turn up, real-estate agents said.

Rising material costs are one reason to be judicious with the projects you choose. Utility is another.

Cindy Scholz said one of her clients wasted more than $1,000 repainting his home’s garage floor and re-wallpapering the inside of closets.

“Don’t fixate on items that don’t matter,” said Ms. Scholz, a Realtor in East Hampton, N.Y.

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The Australian capital setting a new record for property value falls

Property values have fallen hard and fast in this popular city, but it’s done little to dent pandemic rises

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Mon, Jan 30, 2023 2 min

Highest property values, biggest dip the next. That’s the outcome for Australia’s northernmost capital on the east coast, with Brisbane property values recording their largest and fastest decline, data from Corelogic reveals.

The fall comes just seven months after values hit their peak after a population surge driven by the pandemic saw an increase of 43 percent. Home values hit a record high on June 19, 2022 but have since declined 10.9 percent, in parallel with eight consecutive interest rate rises since April last year.

Historically, peak-to-trough declines in Brisbane have lasted 14 months and have ranged from value drops of -2.9 percent to -10.8 percent. While the new record is just -0.1 percent compared with previous figures, that fall came over 21 months between April 2010 and January 2012. The latest decline was a much swifter seven month drop.

CoreLogic head of research Eliza Owen said it is worth putting the Brisbane figures into context with the rest of Australia’s capital cities, as well as considering the significant rise in property values in the Queensland capital over the pandemic.

“Brisbane now stands out as one of two capital city markets with record declines, the other being Hobart,” Ms Owen said. “Sydney continues to have the largest peak-to-trough falls of the capital city markets (currently at -13.8 percent), while peak-to-tough falls remain mild in some cities (such as Perth, where values are down just -1.0 percent from a recent peak in August 2022).” 

“The record fall in Brisbane home values has not made much of a dent in the gains made during the upswing. The fall in the Brisbane daily HVI follows an upswing of 43.5 percent between August 2020 and 19 June 2022, which was the fastest trajectory of rising values on record. This leaves home values across Brisbane 27.9 percent higher than at the previous trough in August 2020.” 

The median dwelling value in Brisbane jumped from $506,553 at the start of the pandemic in March 2020 to $707,658 by the end of last year, Ms Owen said.

“Despite the large decline from peak, Brisbane maintains the third highest gain in value of the capital cities since the start of the pandemic,” she said. 

“Only Adelaide and Darwin, which are 42.8 percent and 29.6 percent higher respectively than at the onset of the pandemic, have performed stronger. 

“For this reason, there is marginal risk of negative equity for Brisbane homeowners, with the exception of very recent buyers, who purchased around the peak in June 2022 with less than a 20 percent deposit.” 

However, there are signs of resilience in the market. Brisbane remains a more affordable option compared with the other east coast capitals, Ms Owen said.

Although housing values remain higher than pre-COVID levels, Brisbane retains a lower price point than Sydney, with a $435,170 difference in median house values and $280,749 difference in median unit values,” she said. 

“The gap between Brisbane and Melbourne housing values is also significant, with a $119,697 gap between median house values and $97,692 difference in median unit values.

“This could encourage ongoing housing demand from those willing to migrate to the state, or own an interstate investment.” 

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