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Often times, home owners remodel, make improvements or update some features in their homes. They make this decision (about what to do) in terms of enjoyment of use and also the re-saleability of their homes for the future. I'd like to take the opportunity to explain some of the often misconceived ideas about "value" to a property versus "marketability" of a home.

When you buy a home, depending on the market and specific neighborhood that you are in, you could expect some basic features in a home. If you are talking about general America, you would expect cabinets in kitchen, basic appliances like cook top and a dishwasher. You might expect a standing shower in addition to a bath tub in the master bathroom. You could expect a fence around the perimeter of your house. If these items were "typical" and was not out of the ordinary, not having these items could hurt your sale.

Examples of an update versus improvement:

You design and custom-built your cabinetry. It cost you $35,000 just for the cabinets. Then you add $15,000 worth of top-of-the-line stainless appliances. You have granite counter tops with undermount sink. You picked the perfect 16 inch travetine tiles to go with your cabinetry. You ordered high-end brush nickel hardware to complete your kitchen remodel. In the end, it cost you over $80,000 for the remodel. No doubt that every buyer that walks into the kitchen will drool all over your kitchen. But what you have done is essentially "updating" your kitchen. You did not "improve" your kitchen. Will you be able to recoup even half of the money you invested into the kitchen? I seriously doubt so. However, if the rest of your neighbors have this high-end kitchen, then not having the same caliber kitchen can hurt your sale. When you purchase a house, you would expect kitchen cabinets, countertops and appliances. It will be very challenging for an appraiser to give you unnecessary higher value simply because you have them while your neighbors do not. You might get a small "plus" for the added umph, but it will definitely not be a dollar for dollar investment.

You want a high-end kitchen.

You want an outdoor living space - because it is slowly becoming a highly sought-after feature in Frisco, TX. You built a pergola and laid flagstones on the ground. You have an outdoor fireplace and a permanent BBQ grill on flagstone. This "backyard" concept would be considered an improvement to the property because it originally was not on the property.

There are 2 important points here. The first is to understand the difference between updates and improvements. Then, the second is to understand if they (the updates or improvements) bring any added monetary value to the property. These two items are separate and independent of each other. You would not say just because these are "updates" hence they do not bring an increase in monetary value or just because this feature is an improvement to the property, that it would increase the value of the home.

More examples of updates and improvements (Note that an improvement may be considered "standard" in different part of the country. Exercise your own judgment here):

Ultimately, understanding this key concept is important when you are ready to sell. We do many things to our homes because we enjoy it. Sometimes, it is okay to make those updates or improvements even if they may not increase the value of our properties. We do it for our satisfaction and we enjoyed it while we had it. Not everything must be a business proposition but when it comes time to sell it, your Realtor(R) can walk you through it.

Some improvements have little or no added monetary value. Examples such as under-counter lighting, and removal of wallpaper or popcorn ceiling will only add to the "marketability" of a home instead of monetary benefits. Again, your Realtor(R) can walk you through these items.

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