You are ready to sell your home and move on, but when you look at the work that needs to be done, you know that your home isn’t as attractive to buyers as it could be. Maybe the roof and windows are old. Maybe the siding needs to be replaced. The curb appeal isn’t there, and you know that any buyer will look at the work to be done and take that into consideration when deciding whether or not to make an offer. You may wonder if it’s even worth it to do the work that you won’t be there to enjoy, or if you should just lower your price and sell your home “as-is”.
Financial Commitment to Home Improvements Before Selling
Home renovations are an investment. When you are looking to sell your home, taking a hard look at your budget is important, especially since you’ll most likely be dealing with a new loan for your new home. Taking on new debt can be risky. If you need to borrow, most lenders require that your current mortgage balance, plus the new loan, be no more than 90% of your home’s value. When budgeting for home improvements, take this amount into account.
If you have the cash saved, this is the best option. You’ll avoid paying interest, and you’ll avoid taking on any additional debt. However, this does mean that the cash you use will be tied up until after you sell your home. It’s important to make sure you leave some cash available in case anything happens before the sale is complete.
Taking out a second mortgage with a fixed interest rate can give you a certain amount of cash in a lump sum. You will want to pay off both the first and second mortgage when you sell your home, so it’s even more important to only take on projects with a high return on investment (ROI).
Home Equity Line of Credit (HELOC)
With an HELOC, you will borrow only what you need for each project instead of getting a lump sum. The interest rate will be variable, so this is also smarter when you know that you’ll get a high ROI to pay back the loan after closing your sale.
Exterior Home Improvements with the Best Return on Investment
There are many exterior home improvements that will provide an average return on investment of at least 70%. In many cases, buyers will be willing to pay more for a house with a new roof, windows, or siding, simply because they know that they won’t have to take on these renovations themselves for many years. These are the exterior home improvements that will provide the best ROI. These exterior home improvements will also increase curb appeal, which can also result in a higher sale price.
- Window replacement
- Siding Replacement
- Roof Replacement
- Garage Door Replacement
- Entry Door Replacement
- Exterior Deck or Patio
Advantages of Exterior Home Renovations
Selling your home as-is means you make it clear to buyers that you will not make any repairs before the closing. You will have to adjust your listing price, usually significantly, to accommodate that. If your property needs repairs, your home still may not sell, or buyers will try to negotiate the price even lower, or try to negotiate a credit at closing. In many cases, the difference in the listing price makes doing at least some exterior home renovations the smarter financial move.
While each situation is different, doing the exterior home renovations before listing your home to sell just makes sense. Your home will be more attractive to buyers, which will result in a quicker sale and a higher purchase price. While selling “as-is” won’t require an up-front investment, the length of sale and ultimate selling price is often disappointing. We highly recommend tackling some of these exterior home improvements before talking to a real estate agent about selling your home. We understand this is a big decision and that’s why we’re here to help. Contact Armorvue Home Exteriors today for a virtual appointment to discuss the benefits of exterior home improvements and which projects make the most sense to finish first. We’ve been installing and replacing windows, doors, siding, roofing, and patio covers in this area for decades, and we’d love to put our expertise to work for you!