Home Improvement Mistakes That Impact Real Estate Value


Home Renovation Mistakes That Can Cost You


Part of the fun and satisfaction of owning a home comes from renovations – it’s your house, and you can make it exactly like you want it. Unfortunately, some homeowners get caught up in renovating their homes and fail to take into account what those changes will do to the resale value of the property. You have every right to turn your house into an ideal dwelling for yourself, but you should keep a few things in mind if you ever plan on selling the house in the future. If you plan on selling in the near future understand it’s important to understand what home improvements have some of the lowest return on investment.


Before you dish out any money on a renovation with an expectations that it will add value to your home, pause for a moment and consider the long-term implications. If your renovations fall into any of the following areas you may wind up spending more than you will ever get back when you sell. You may be thinking to yourself that the purpose behind making these changes to your home has nothing to do with re-sale value and everything to do with personal enjoyment. While that of course is perfectly acceptable (after all it’s your home), just don’t forget this when it comes time to sell your place.


There are many home owners who incorrectly believe that every home improvement they make to their property comes back to them in the form of increased value. This is not the case and in fact there are things you can spend money on that not only don’t add value but can actually make your place more difficult to sell.


So while your intentions on making home improvements have nothing to do with re-sale value don’t forget this when it comes time to sell your home.


Standing Out Too Much


The homes in the surrounding area have a lot to do with the market value of your property. This remains true no matter how much you invest in your house. It is understandable that you want to make your home as nice as you can, but you risk possible resale problems when you upgrade too extravagantly. You may still be able to sell the house, but you may not get your money back if the renovations are too far beyond the standard for your area.


For instance, if you were to install an elaborate in-ground swimming pool on your property for $25,000 while everyone else in the neighborhood makes do with a lawn, you may not make all that money back when you sell. If all the other houses are going for $150,000, do not expect to move yours for $175,000 just because you have the pool.


Real Estate experts will always tell you that it is best to be the lowest priced home in the neighborhood because all the other more expensive homes will bring up the lower priced homes value. Just the opposite occurs when you over improve for the area.


Above Ground Pool


Since we are discussing swimming pools, this particular “addition” must be mentioned. This is in fact one of the top home improvement mistakes owners make.  An above ground pool may provide lots of fun for the kids or perhaps even for you, but do not expect it to add value to your home. Even the top of the line versions are still considered undesirable for most any home buyer. These are considered so unsightly that they can actually lower your home’s value, simply because most buyers will calculate in the cost of their removal into an offer.


If you have one of these and are enjoying it, you can certainly continue to do so. However, if you decide to sell, it is probably best to have the pool removed and new sod put down before you put the house up on the market, especially if the pool is not new.


No Permits


Depending on where you live you may be able to get away with renovations or additions to your home without permits. For many however this is not the case and could cause you serious headaches when you go to sell your home. Realtors and buyers may balk at a home that does not meet regulations, and for good reason.


Insurance companies will look for any way to avoid paying on a claim and a lack of proper permits is the perfect excuse. This can cause lenders and appraisers to consider your home less valuable and may even make it worth less than when you started. Make sure that whenever you are adding on an addition or are making major improvements to mechanical systems such as plumbing or electrical you apply for a permit with the local building inspector’s office.


This is a home improvement mistake that I have personally seen come back to haunt sellers when it comes time to sell. Not pulling permits is a blunder that should be avoided at all costs.




When buyers look at a home they usually consider the whole package. This is why consistency in your renovations is important, because they may not be willing to pay more for an over-the-top addition to your home. Some homeowners get caught up in the idea of adding the perfect kitchen or bathroom and fail to see that the rest of their home only looks worse because of it.

This is not to say that you should avoid improving on your kitchen – just keep in mind that dumping your entire improvement fund into a single area could cause an imbalance, one buyers are not willing to pay for. Spreading out the improvements might yield more rewards when trying to sell.


The perfect example is the home owner who installs a new kitchen complete with gorgeous cabinetry, granite counters and stainless appliances but leaves the linoleum floor that was installed twenty years ago. It stands out like a sore thumb and negates much of what you have done to improve your home. The same could be said if your adjoining dining room has shag carpet or worn looking hardwood floors.


Shoddy DIY Home Improvements


Do it yourself projects can be fun and rewarding, but they can also affect the value of your home negatively. Crooked tiles in the bathroom and unreliable wiring in the finished basement are not selling points, even if they were learning experiences for you. Most of the time it pays to bring in a professional to do your renovations. This way the additions you make to your home will actually add value.


Don’t think this matters and nobody will notice? This is one of the first things a good home inspector will look for. Most home inspectors will immediately be able to distinguish do it yourself work from that of a professional. It is an obvious mistake to make home improvements you are not qualified to do.


Too Trendy


There are classic choices and there are trendy choices. For people interested in selling their homes, classic is usually the safer bet – at least if you want to get back the money you spent on the improvements. Shag carpet was all the rage for a time, but now it is almost unsellable in a home. Avoid the styles of the moment if you want to add lasting value to your home.


Color Obsessions


It is your home and you can paint it whatever color you like. However, to get the best price on your home you should have a fallback paint plan before you put it up on the market. Lighter, more neutral colors – think off white – are much more appealing to potential buyers than anything else out there.


Your child’s room may be bright purple and your art room may be neon yellow, but you should be ready to change them back before you begin the sale process. If you can’t stand the thought of any kind of off white then choose colors that are “earth tones.” A large percentage are attracted to shades of brown. Use these colors to spruce up your home and you will be happy with the results they bring.

If you have the attitude that it is just paint and any buyer can just look past my colors then you don’t understand the psychology of selling. I would be the first person to put up my hand and be in agreement with your thinking if I had not seen firsthand how wall colors can stop a home from selling.


When researching why a home is not selling Clutter and Wall Color are the biggest factors. The problem is that many buyers cannot visualize beyond these two factors. For those that can they just don’t understand how this could stop a sale. Folks it can and it does.


Too Personal


One of the nice things about owning a home is that you can do practically anything you want with it, including making it unusable for future owners. If you never cook, for example, and tear out the entire kitchen because of this, you are going to affect the value of your home. Everyone is looking for a kitchen, making your property an unthinkable purchase for 90 percent of buyers.

While this is an extreme example, in my years as a Real Estate professional, I have seen a lot of strange things done to homes. While it is perfectly fine to make your house your own, be aware of the consequences in the future when you want the most money in your pocket!


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