Upgrade This!

Interesting article about people upgrading their homes prior to sale - called Eleventh Hour Upgrade. The sellers stories in the article vary greatly. The Manhattan woman purchased her place almost 30 years ago with her only upgrade being a kitchen 13 years ago. If she wants to get top dollar and get the largest buyer pool she will need to do some upgrading - which is why she did it. Another California woman points out that better to have the place looking clean and new rather than have the most expensive appliances and pergraniteel. In Ohio, one man put $23,000 into upgrading his nine-year-old home. After he sold his home and the realtor takes their share he netted a whopping $5,500 from his original $700,000 investment - but he was just happy that his house sold.

From the article -

No matter what the upgrade, homeowners aren't likely to recoup all the money spent when they sell. According to Remodeling magazine's annual Cost Versus Value Survey, the overall return for remodeling projects is on the decline, falling to an average of 70 percent in 2007 from 86.7 percent at the market peak in 2005.

For a project using midrange products, the best returns come from putting on a new deck, replacing the siding and sprucing up the kitchen; the lowest returns come from remodeling a home office, adding a sunroom or putting in a backup power generator.

Some of the big upgrading investment during the bubble were helped out by the mere fact that house prices were going up by double digit percentages every year. Even a so-so upgrade done slow enough would generate a large return for the flipper or homeowner. Also during the Great Housing Bubble there were enough flippers and speculators buying up property at high asking prices looking for an even greater return after minimal work - just watch one of the Flip this House shows to see this in action.