Susan Ormont - RISK VERSUS REWARD: A SIMPLE GUIDE FOR INVESTING IN REAL ESTATE

dreams come true, but that doesn’t make them the appraiser’s, nor potential buyers’. If remodeling is a must, treat with caution and avoid overspending. In general, the kitchen is the heart of the home, so it will impress potential buyers to have a nice one. However, you will not realize a 100% ROI on a kitchen remodel. No one is telling you to hang on to the plaster or old ceramic sink, but it would be smart to tread with caution.

Take a dip elsewhere.

Before installing an in-ground pool prior to sale in the hope of adding value to your home, think this through. Pools are for homeowners who want to enjoy them — and have money or energy to maintain and service them. They are not a particularly strong draw to home buyers, and don’t have a particularly good ROI. In New England or any state that experiences real winters, an in-ground pool holds less value than in the warmer states. There are some possible exceptions, of course. If you live in Southern California or Florida, a pool might very well be an important element for more than a few potential buyers. Also, many potential buyers view pools as a hazard, especially if they have children or grandchildren who will be visiting or living in the home. They will also be aware of the extra costs attached to the pool for insurance, maintenance and water bills.

Adding on.

Room additions are not generally cost-effective for flips, as it takes at least a few years for them to earn a decent ROI. Some of the most expensive projects provide the lowest returns. Of course, there is wide variance in building costs. Again, according to Remodeling magazine, a 200-square-foot sunroom addition with footings and slabs-on-grade foundation can cost up

68

Powered by