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August 27, 2016 by Ryan Shaw Leave a Comment

How You Can Wreck the Value of Your House

Money losing home improvements

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You are about to make a change to your house when all of sudden you pause and think: “Is this actually going to help me in resale?”

What devalues a house?

There are certain improvements that can actually take value away from your home. Some others cost much more than you will receive back in resale.

Here are a few ideas to guide the process.

Covering Wood Floor That Needs Work with Carpet

older wood floor

Q: Should I cover a wood floor with carpet?

Don’t replace or cover a more expensive item with a cheaper one. Sometimes it is tempting to cover up a hardwood floor that needs attention, such as sanding or refinishing with carpet.

Don’t do it!

A hardwood floor that needs to be refinished is more valuable than brand new carpet to most buyers.

In fact, refinishing your floors is one of the best investments you can make and is often less expensive than putting down carpet in that same area.

Don’t feel comfortable refinishing floors yourself? No problem! HomeAdvisor can connect you with top local flooring professionals free of charge.


Fence

Q: Does a fence add value to your house?

small wooden fence

This depends.

Don’t block your view. Rigidly defining your lot with a stockade fence can make the lot appear smaller and claustrophobic. Even when there is perhaps a view that is distasteful it is better to screen the view than block it. Landscaping, shrubs hedges or trees, and fencing that has some space between the boards can create privacy without closing you in.

Make sure to choose the right fence and avoid making it look like a jail!

Inside the house you also don’t want to block out the visual of the outside, it adds dimension to the interior when you can see the outside from it. Fences that block views are more likely to cost more than you will recoup.

If you need a fence, make sure there is some space between the boards.

Keep in mind that if you do add a fence, you are adding new maintenance costs. A fence needs to be painted/stained every year or two and if you don’t keep it looking in great shape it will come back to bite you.

Turning a bathroom into a regular room

Q: Does converting a bathroom into a room hurt the value of my house?

If you have bathrooms in your home attached to a bedroom and only one not inside of a bedroom, the last thing you want to do is convert that guest bathroom into a room.

You are actually making it harder for a bank to approve a loan for someone if there isn’t an independent bathroom in the house.

Converting a garage or closet into a room

Q: Is it ok to convert my garage into a room?

Don’t take away storage space. It is generally not a good plan to convert a closet, garage, etc into something else unless you have the only house on the planet that has too much closet space.

One of the main things I hear from buyers looking at houses is either “plenty of closet space” or not enough — so it is the main point when looking to buy.

A survey of 7500 home buyers conducted by real estate firm Crescent Communities revealed that a whopping 74%of home buyers said that having a garage was extremely important.

People have a lot of stuff and need space for all of that stuff. Give the people what they want!

Pets

Two little puppies playing on grass with leaves

Q: Does having pets devalue my house?

Pets may devalue your home only if you aren’t as diligent as you should be about cleaning up after them. You may have to replace carpeting faster than you otherwise would but other than that a pet is not going to devalue your home.
Problems arise when there are too many pets in the house or you don’t keep up with the extra cleaning and maintenance that come with pet ownership.

Pool

Q: I’m thinking about adding a pool. Will I get the investment back when I go to sell my house?

A pool seems like a dream to have right in your backyard until you realize you just added a huge monthly expense and additional maintenance headaches. Don’t get me wrong, in warm climates a pool does give you a boost in value, but it’s rarely enough of a boost for you to recoup the expense.

Pools can cost anywhere from $30,000 to $100K depending on how fancy you want to go with it.

Pools fit into the category some homeowners fall into: “over-improvers”.

Don’t over-improve. This may not de-value per se but it won’t likely add value to the point of the expense–so you’ll end up losing money in the long run.

A pool, for example, is rarely worth the cost in resale. It is good if the features of the home are in unison with each other, so if you have, for example, hardwood floors, and a viking stove in the kitchen–you need a high-end countertop to go with that, but if you have low-end cabinetry and vinyl flooring a laminate countertop is fine.

One case where a pool may return value for you is if you own a high-end home in a southern climate. If you are trying to appeal to the luxury crowd and you don’t have a pool, your home might actually sit on the market for a long time. Know your potential buyers and map their interests to your house.

Painting Brick

painting brick

Q: My brick is starting to look like an eyesore. Does painting brick devalue a house?

Don’t add a chore.

It may seem like it would be a good plan to paint a brick facade, maybe to lighten things up–but you have just turned a maintenance-free feature into one that will need to be maintained. Low or no maintenance is usually a very attractive feature, even if the feature isn’t as attractive (see what I did there?).

Please, do not paint the brick!

Smoking

Q: I’ve been known to smoke indoors at my house. Does smoking devalue your house?

Smoking is terrible for your house

We saved the best (aka worst) for last. Smoking indoors can potentially be the most damaging thing you can do to your home’s value.

A survey of Canadian realtors found that 88% thought it would be more challenging for them to sell a house that an indoor smoker lived. The same survey also found that half thought it lowered the value of the house, with 32% of those respondents saying it would lower the value up to 29%.

Depending on the value of your house, that could be anywhere from tens of thousands to hundreds of thousands of dollars.

If you think that’s a bit too apocalyptic, consider how hard it is to get smoke-out clothes after just one day near a burn pit. Now think about what they would do to the inside of a home after years of smoke exposure.

Every fixture, the walls, carpets, paint all must be cleaned extensively and sometimes replaced outright

Over on the “Agent 2 Agent” forum on Trulia, agents are talking about not even accepting a listing if the seller won’t stop smoking and attempt to rid the house of the smell. That’s how bad the damage can be and how much of a turn-off it is for buyers.
There are some other things outside of your control that can also bring down your property value.

High HOA Fees

Q: I found the perfect place, but it comes with HOA fees that are above other comparable communities. Do high HOA fees hurt resale value?

On the whole, owning a home is cheaper than renting. Data suggests that it is about 35% cheaper than renting with low-interest rates and staggering rent costs.

This 20+ percent margin can get eaten up quickly but high monthly Homeowner’s Association Fees.

If you live in a condo or townhouse community, or even a housing community with high HOA fees, it can act as a serious detriment when you go to sell the property. When a vote comes up to raise HOA fees in your community, make sure you lobby against it if it puts your community at a price disadvantage with other comparable communities.

The last thing people want is another high monthly bill. Buyers will look elsewhere if your HOA fees are too expensive.

Unsightly Property Next Door

Q: My neighbors don’t take care of their house. How can I keep that from affecting my home’s value?
Maybe the neighbors are a little less than stellar with their yard maintenance.

Maybe they are hoarders!

Unfortunately, you have no control over that.

Your best bet is discreet screening with landscaping or some fencing–not a stockade barricade. A fence with a fast-growing vine on it that will act as a screen or some fast-growing shrubbery or hedge.

You can also create a diversion by making a big splash of color away from the neighbor boundary that will draw the eye away from the problem.

💰 What is my house worth? Get a free, instant home valuation

Filed Under: Sellers

About Ryan Shaw

Ryan Shaw is the original founder of The Real Estate Witch, a site dedicated to thoughtfully answering the questions of home buyers, sellers, and real estate investors.

Ryan's work has been cited in a number of real estate and personal finance publications, including Inman, Tech Bullion, MSN, and RealTrends.

Education: BA Political Science — University of Southern California

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