Adding Value to your Home for Dummies
How to add value to your home
Homes are meant to be lived in. If all you needed were a place to store your stuff, you’d get a storage unit. If all you needed were a place to work, you’d get an office. If all you needed were a place to feed your family, you’d go to a restaurant.
There’s something about a home that’s more valuable than all those places combined, but occasionally, it takes a little work to get there. If it isn’t serving the right purposes, functioning the way you need, or acting as an expression of you, it may be time to renovate.
Whether prepping your home to sell or improving your living value, renovation is a massive part of ensuring you achieve your goals. Of course, renovation equates to value, but people often get stuck trying to make that happen.
Improve function and aesthetics
Renovating your home is about more than just making it look pretty—it’s about improving the experience of using a home. If a home is meant to be lived in, it needs to function and perform jobs to help people live there.
Renovations should start by asking the question, “What do I need this room to do?” For example, if you’re in the kitchen, maybe you need more cabinet space. Perhaps you want a better bath experience if you're in the bathroom. There isn’t a right or wrong answer to the question, but there are common trends, both timeless and trendy, that might inform what kind of renovation you need.
Once you know the purpose of a room and what it needs to do for you, you can begin planning the home's aesthetics. How you present the house through color, material, texture, lighting, and spacing all work together to establish the aesthetic or vibe. After considering the home's functional and aesthetic needs, you can begin planning renovations that add tremendous value.
Types of value
But what do we mean when we talk about value? Broadly speaking, there are three types of value: principal, resell, and intrinsic. Whenever we use the word value, we mean it interchangeably unless tying it to one of the three specific types.
Principal (price) value
The principal value—or price value—is the literal, actual price of the home. When speaking of this value, we mean the listing price you will decide upon with guidance from your real estate guide.
Particular renovations will occasionally have measurable effects on the principal value. For instance, in your market, you can estimate the value a 3 bed 2 bath home will have over a 3 bed 1 bath. However, how much effect certain renovations have on the principal value will depend on a number of factors ranging from the renovation's quality and scope to the home's area and location.
Resell value
Rather than affecting a price point, resell value speaks to a home's appeal, attractiveness, and desirability. While certain renovations might not move the needle on the home’s listing price, they may drastically tip the scales on how desirable your home is. So even though your home may be at the top of the range for your neighborhood, the resell value and attractiveness of the house may be enough to justify someone bidding on the “expensive” option.
Intrinsic living value
For some people, a renovation has little to do with improving their home's principal or resell value. Not every decision relates to the product-market fit of their home or maximizing their return. Sometimes, people just want their home to feel more like theirs.
Your home's intrinsic value comes down to what your home means to you. If you love your home, neighborhood, and community but don’t feel like you’ve fully settled into your home as much as you know you could, a renovation may be right for you. A new couch, rug, or art won’t always be enough. It may be time for a more elaborate effort.
Popular home renovations
Once you’ve established your home's needs, you can look at individual rooms, and you may improve them to suit your purposes better. Generally, the most popular methods of adding value to your home are renovating your kitchen or bathroom or adding square footage.
Kitchen
The kitchen is an essential element of the home, and out of all the rooms, it serves the widest variety of functions. Not only is it where you store and prepare food, it also serves as a gathering place, a visual focal point in the home, and a stage for entertaining guests and family members.
Opening up the space within a kitchen is often a surefire method of adding value. For an easy and classic kitchen renovation project, look for ways to open the room to create an inviting space. Additionally, looking for ways to add practical value, such as storage space.
Bathroom
After the kitchen, the bathrooms are huge selling points within a home. Whereas the kitchen is more public and oriented around entertainment, health, and community, the bathroom is private, intimate, and secluded.
However, based on your needs, the bathroom may be the best place to start. For example, if you’re not someone who hosts a lot or prefers cooking, but you have overnight guests or even need a safe place to relax and prepare yourself, starting with the bathroom is reasonable.
In fact, we recommend starting with the master bathroom if you can only choose one for no reason other than where you will spend your time, and you’re the first person who needs to love the home.
Remember, it’s about figuring out how you need the home to function. There are thousands of possibilities when renovating a bathroom. The options are endless, from tile choice to counter and sink layout to color and texture.
Adding square footage
Adding square footage to your home is the third major improvement you can make to add value. This comes last, not because it’s the least worthy option, but because it’s often the most expensive. However, finding creative ways to add square footage often has the biggest potential return on the principal value. Adding a bedroom or bathroom is the easiest way to find new space.
For example, we had a 4 bedroom 2 bathroom house, which isn’t very common today. The second bathroom was a very large jack-and-jill bathroom. We split the bathroom down the middle to create 2 separate bathrooms, transforming it into a 4 bedroom 3 bathroom home, substantially increasing the selling price. Even though the two bathrooms were small, creating an extra bathroom in the house was more than worth it
Renovating your home on a tight budget
Not everyone can jump straight into a significant project like renovating a kitchen. Sometimes, you have to start small. Someone of our favorite renovations can be made with budgets below $200 but yield tremendous gains to value.
Fireplace
Your fireplace, mantle, or hearth is a focal point for your home—much like the range in your kitchen. Improving the fireplace can be as simple as adding a fresh coat of paint, refreshing the materials, installing a new mantle, or mixing the texture. A $200 budget will be enough to make a beautiful difference.
Painting
The most affordable option with a lot of value-add is simply a fresh coat of paint. Painting can feel like a new transformation, especially if your paint is cracking or fading. If painting doesn’t feel right, or there’s only a certain area you’re concerned about improving, consider using wallpaper which has been making a resurgence over the last few years.
Light fixtures
Fine lighting fixtures have grown in popularity in recent years. Homeowners turn to new lighting fixtures to express their style and personality while standing out. Despite remaining relatively inexpensive, they come in various styles, including material, geometry, personality, and more.
Wainscoting
A wainscotted wall has boards, panels, or moldings that cover its lower portions. Though there are minor protective benefits, their utility is mostly decorative. Wainscoting dresses up a room by adding unique texture elements to break up the visual appearance of walls and rooms.
Landscaping
Your home’s curb appeal is essential for improving the resell value. Your landscaping might have little effect on the principal value, but if a homebuyer sees the exterior of the home taken care of, then they become more likely to visit the interior.
Landscaping can be inexpensive and easy to execute. Simply trimming bushes and laying mulch down may be enough to improve your home’s curb appeal. For more thorough landscaping options, consider researching flora native to your area you can add to create a natural and inviting environment.
Would you like help along the way?
If you’re just beginning your journey into adding value to your home through renovation but aren’t sure where to start, these tips will provide a good starting point. Still, we know it won’t answer all your questions.
If your Pinterest boards have grown, but you haven’t known how to pull the trigger, or if you’re ready to start construction but want to work with a team you can trust, then schedule a meetup with the 6th Ave Homes construction team. You’ll work closely with them and our designers to create new value for your home and renovate it into the home of your dreams.
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