So you’re thinking about selling your house this year, but your real estate agent has given you a list of areas that need “some work” before putting it on the market. At the top of the list is your kitchen with its orange oak cabinets, laminate countertops, worn floors, and mismatched appliances. Homeowner interest in remodeling is off the charts thanks to HGTV shows like Property Brothers and Fixer Upper. These popular shows make kitchen renovations look like a no-brainer – plug up a nail gun, punch some holes in the wall, slap on some trendy gray paint and that’s it! Watch enough of these shows (I’m so guilty) and the $50k-$100k kitchen renovation budget seems normal and worth it, but is it?
As homeowners, we believe a major renovation is mandatory before putting a house on the market, that sprucing up the place requires spending big dollars to catch a buyer’s eye. Our HGTV addiction has convinced the average homeowner that every dollar spent plus more will be recouped on the sales price. While that is typically true for the property investor whose strategy is to buy low and sell high and to put in the sweat equity themselves, it’s just not the case for us average folks. Often, our high-end, big-budget kitchen overhauls fail to pay for themselves. Your best bet as a homeowner in getting the most bang for your buck is to develop a strategy of your own.
What really is your motivator for renovating? In the past, the leading motivator for a kitchen renovation was to improve resale value with the plan to list upon project completion. However, that has changed. In the 2018 U.S. Houzz Kitchen Trends Study, just 6% listed this as the motivator for the kitchen renovation. The remaining respondents listed the motivators as: “Can no longer stand the old kitchen” (41%) and “Wanted to do it all along and finally have the means (36%). According to this study, resale isn’t just as big a consideration as in years past.
Carefully choose what to upgrade, update, or renovate. Pay attention to the homes in your neighborhood to avoid over-improving. Before you invest a ton of money, look at the competing properties and see what they offer and determine how you measure up. If none of the houses in your neighborhood have Carrara marble and custom wood cabinets, then the addition of these features is unlikely to get you a higher selling price. Focus on what improvements you should be making based on your specific market.
If your objective is to sell your home easily and to sell at a higher price, then consider a smaller kitchen renovation or perhaps minor/midrange updates. Cost vs. Value can’t be overlooked. Some renovation costs are completely recouped for minor or midrange kitchen remodels; however, recouping a high dollar kitchen renovation is trickier. Remember, too, that as you get into a major renovation that the costs of the project can increase as times goes on. Research thoroughly your options to stay within budget and always get three or more estimates along with referrals. You want to get the project done on time and within your budget.
BudgetDumpster.com, a nationwide dumpster rental company, has an excellent guide for remodeling a kitchen on a budget. It provides tips on everything from removing old cabinets to the cost of a new kitchen sink to how to budget for new drywall. This guide gives a breakdown on where your budget will go towards certain parts of your kitchen remodel and has practical tips on ways to save.
Your primary residence is not just a house but your home. If you plan to live there for years to come, then add features and amenities that you want to have regardless of their impact on resale. If you are considering a move soon, then carefully consider the Cost vs. Value in your market to get your home up to par for your neighborhood. An extensive renovation may end up only appealing to you rather than to potential buyers. Remember that even minor updates are known to add value so do your homework and talk to your real estate agent before undertaking a big budget kitchen renovation.