What you should Ask your Real Estate Agent before Buying or Selling
When an appraiser arrives to appraise a home, he takes a lot of information into consideration before coming up with that magic number. Any type of home improvement that adds livable space will increase the value of your home. Outdoor areas give you more living space and expand your entertaining capacity without the cost and time involved in an expensive addition. That means you’ll have more to spend on other features like outdoor kitchens, television and audio systems, outdoor fireplaces and fire pits. And when homeowners are ready to sell, they are finding that these new spaces attract buyers.
However, creating an outdoor living space will only add real value to your home if it is done correctly. As a real estate professional in the South Florida market for more than 13 years and an associate at ONE Sotheby’s International Realty in Weston, a city that enjoys indoor-outdoor living year-round, I have represented several homes whose outdoor spaces have weighed heavily on the sale or purchase of the property.
Last year, a home hit the market in West Miramar for $1.3 million. The seller had purchased it for $460,000 in 2011. He invested approximately $250,000 on a backyard remodel, adding multiple pergolas, enlarged the pool, a mosquito mist system and an outdoor kitchen. He invested another $150,000 on indoor renovations. The buyers fell in love with the backyard and paid $1.1 million for the home, giving the seller a return of 28 percent on his investment.
Sometimes, a small investment can get you a bigger return. I listed a home on the market where the owner added a well-positioned, mini basketball court that cost approximately $5,000. I was able to sell the home for $10,000 over asking price and in just one weekend — 6 percent higher than a similar model right next door.
Here’s what I recommend homeowners keep in mind when planning an outdoor space to get the most return on your investment.
Know your neighborhood: Creating a backyard living room is an easy way to add livable space to any home. But as with any renovation, you must know your neighborhood. Don’t renovate your home out of the market. If your outdoor space is the only home in the neighborhood with a high-end kitchen, an entertainment system and other high-end features, then you will not be able to get much return for your investment in the resale of your home because the other homes in the area will keep the values down.
Imagine homeowner X invested $60,000 in a remodel to create a one-of-a-kind outdoor space in his neighborhood, where most outdoor remodels in the area do not run more than $20,000. Homeowner X will likely not see a full return on his investment because a potential buyer, looking to buy a similar home in that area, would be able to do the remodel for one-third of the investment.
Proportion: Your outdoor space should be proportionate to the outdoor area. Creating an outdoor focal point, such as a pergola, gazebo or tiki hut, very common in South Florida, that is too big or too small to the outdoor space itself can make the outdoor space feel disproportionately distorted. A pergola that is too big will make your yard feel small, for example. This perception can take away from the value of your home when reselling it. Buyers will feel the space is smaller and this may cause them to offer less and your home may remain on the market longer. When designing your outdoor space, take into account the size of your property and design these features to proportionately fit into that area.
Lighting: Well-designed lighting extends the use of your outdoor space. With good lighting, you can now enjoy the outdoors at night. I always advise my clients to incorporate landscaped lighting into their outdoor design. For $750, you can purchase an entire low-voltage, outdoor lighting system from your local hardware store. This creates a comforting ambiance and a sense of security that adds an incalculable value to the property.
Don’t clutter: A common mistake that homeowners make is filling up every square foot of the outdoor space with lots of furnishings, leaving you with little room to walk or roam around. Not only will this clutter make the space feel smaller, but over-furnishing can make the space feel crowded and that goes against the open feeling you are looking to get from being outdoors. Instead, create different seating areas that feel airy and spacious with plenty of space to play and walk around. Save the money you would have spent on all the extra furnishings that will crowd the space and invest it into other areas of your home.
Think green: Outdoor spaces are created to enjoy the comforts of indoor living while taking in the beauty of the outdoors. Don’t pave the entire outdoor area, for example. Invest the money you would have spent on all those pavers into other items in your budget. If you have older trees that provide good shade, incorporate them into your design. This will also make your space feel inviting. Allow for your outdoor space to have a good balance between living space and natural elements.
Privacy: All the work and expenses you’ve put into your new outdoor space will diminish in value if you do not have privacy. For one, you will never enjoy the space if you feel your neighbors can see your every move. Your renovation budget should include nice fencing and easy-to-maintain shrubbery that will grow full to provide that sense of privacy that will allow you to enjoy the space. Privacy has a value in itself!
An outdoor living space is not only a great feature to enjoy while you live in your home, but it will also attract buyers when you’re ready to sell. Buyers are willing to pay top dollar for a home with a well-done, livable outdoor space. I’ve seen homes with a well-designed outdoor space sell for 6 to 7 percent above homes with plain backyards.
Read more here: http://www.miamiherald.com/real-estate/article105544801.html?platform=hootsuite#storylink=cpy
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