With the continued FED rate and subsequent mortgage rate increases, it’s logical that the real estate market demand has cooled. However, because of the supply constraints over the last three years, the waning demand has not significantly affected prices here in Atlanta. I view this as a positive for our real estate market in the medium term.
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With uncertainty in the residential real estate market, many homeowners are considering renovations in anticipation of selling their home when the housing market pressure eases. So is renovating your home something you should consider if you plan to sell in the future?
The answer to this depends on a few factors, including the condition of your home, what renovations are needed, and what potential buyers are looking for. Generally, making any immediate repairs or updates is a good idea to ensure your home is marketable. This could be as simple as a fresh coat of paint or an updated kitchen or bathroom.
You should assess the cost and potential return on investment if the home requires more extensive renovations. It may be beneficial to make some renovations to increase the value of your home before selling it.
If you decide that remodeling is the right choice for your situation, below are four renovations that will add value and two to avoid.
For most people, the kitchen is the centerpiece of a home. It’s where you spend the most time gathering with friends and family, sharing meals and conversations, and starting or ending your day.
Therefore, a comfortable and convenient kitchen layout can be a solid foundation for a home and an attraction for buyers. For this reason, it’s one of the first renovations to consider in your home.
In our Southeast region, minor kitchen remodels (a facelift and new appliances) can cost approximately $27,000 and have an ROI of 68.6%.
Clean and modern bathrooms are another focal point buyers seek out.
According to the Houzz and Home 2022 home study, guest and primary bathroom renovations were the most popular among homeowners behind kitchens. According to the study, 30% of new homebuyers remodeled their bathrooms.
In our Southeast region, bathroom remodeling can cost an average of $25,000 and have an ROI of 55.1%.
This one may be surprising to you. According to remodeling.com, which does extensive research on remodeling trends and costs, new garage doors had one of the top ROIs for home investment at 92.1%. An average garage door replacement costs close to $4,000 in the southeast region. Therefore, it’s one of the few home renovations that recoup close to 100% of their cost.
New garage doors add an excellent boost to curb appeal. But they also can add a security element to the home, and a properly sealed garage door can help with energy efficiency.
Windows, like garage doors, might be an unexpected top-value add option for remodeling. However, new windows have a 65.4% ROI. In our Southeast region, new windows can cost an average of $20,000 for vinyl windows.
New windows appeal to prospective buyers because they can boost energy efficiency, increase security, and help soundproof your home. Likewise, the right windows significantly improve the aesthetics of a home and boost the curb appeal.
While a thoughtful home renovation can increase the value and attract potential buyers, there are a few to consider avoiding if you plan on selling your home in the near term.
Swimming pools are certainly welcome in the hot summer months here in Atlanta. Still, they can often detract buyers due to the high cost of maintaining them.
Likewise, if you combine bedrooms in your home to increase a bedroom size, that could potentially decrease the value of your home because, in general, buyers prefer more bedrooms in a home.
Overall, if you are considering remodeling your home but also plan on selling in the near to intermediate term, consider making renovations with the highest ROI. Likewise, avoid hyper-personalization and too much customization, as your tastes may differ vastly from future buyers.
If you are considering selling your home, I would be happy to work with you and help you think through what renovation would be best for optimizing your home value. Please contact me if you are interested in buying or selling a home in Atlanta.
I was excited but not surprised to see that Money Magazine listed Atlanta as the best place to live in the country in 2022.
Money magazine has been putting out this ranking for over 35 years. It’s among the most reputable annual “best city” rankings.
With the ever-changing U.S. city landscape, the magazine wanted to choose a city “where anyone can feel like they belong.” This statement is an excellent city description of Atlanta and its well-deserved ranking.
If you have read my previous posts, you know I have been very bullish on our city. Therefore, by extension, I am bullish on our real estate market. I believe that the ongoing growth of our city will help support a resilient Atlanta real estate market in the future.
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With such aggressive rate increases from the FED, you would expect a relatively substantial decline in home prices. However, due to the ongoing supply issues, elevated home prices have been resilient, with only moderate declines in specific markets. We seem to be at a curious standstill in the housing market where prices, buyers, builders, and sellers are not budging.
I don’t foresee any significant changes in the urban Atlanta market in the near term. Demand still exists, and there is not enough supply. However, as I wrote about last month, I am starting to see some better opportunities for astute buyers.
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The past three years have been challenging for Atlanta homebuyers. With limited inventory and rising prices, it’s been a seller’s market.
However, we are slowly shifting back to a balanced market where buyers will have more choices and less competition.
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If you are trying to decide whether or not to sell your home right now, you’re not alone. Many of my clients are asking me this same question. Undoubtedly, some unpredictability in the market may be causing sellers to pause, but this still could be an excellent time to sell.
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There is a lot of uncertainty in the overall economy, and it’s easy to see that uncertainty trickle down into the real estate market. However, given the widespread supply shortages, I don’t foresee any significant downside changes to the price of homes in the near term. But with rising rates and prices at all-time highs, we could see home prices start to flatten.
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With mortgage rates rising to the highest levels seen since 2009, some contraction in demand is expected this year.
However, I am still optimistic about the Atlanta residential real estate market. Growth and development can be seen throughout the city, yet the supply of residential real estate remains at record lows.
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Are you planning on purchasing a home in Atlanta this year?
If so, you’ll want to read this.
In order to save money, many clients ask me if it’s better to buy a fixer-upper in this market where home prices are high.
In certain conditions a fixer-upper could be a good option. But in the current economic and residential real estate environment a move-in-ready home may be your best choice. Read on to learn why.
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News headlines have been stating that there is a slowing down of the residential real estate market but here in Atlanta that is not the case.
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