Scrolling through lists of home features as you shop for a new house can be a dizzying experience. It can be difficult to know which home features you really want, which add value to the home, and which don’t. Let’s look at some things that contribute to a home’s value over time, and ways in which you can add value yourself.
The Features Most Folks Want
- A dedicated laundry room. Turns out, the old saying about airing your dirty laundry in public is true; a separate laundry room is one of the most desired features with home buyers, according to the National Association of Home Builders. People will pay for the privilege of keeping dirty laundry out of their living spaces.
- Three bedrooms. Three is the magic number when it comes to how many bedrooms the majority of home buyers want. Overall, 47% want three, compared to 32% who are looking for four bedrooms or more. Though drilling down on NAHB stats shows that 47% of married couples who have children want a minimum of four bedrooms.
- Open floor plans are highly desirable. So much so that a whopping 85% of home buyers say they want free-flowing space between the dining room and kitchen, while 79% want to have an open space between the family room and the kitchen, and 70% want the same between the family room and the dining room.
- Walk-in pantry. One of the most popular kitchen features with home buyers, walk-in kitchen pantries means more living space and less storage in the kitchen. Lots of people these days buy in bulk at big box stores, and it’s nice to have a place to store all those non-perishables mere feet from the cooking area.
- Two bathrooms are perfect. But not by an overwhelming majority: 37% of homebuyers want two bathrooms; 21% are looking for 2.5; while 26% wish to have more than three baths.
- Full bath on the first floor. According to the National Association of Homebuilders, having a half-bath on the first floor increases an average home’s value by 10%. Which is impressive enough. But that doubles to 20% if it’s a full bathroom: toilet, sink, shower, and tub. From families with young children they can bathe on the main floor to older adults who wish to climb stairs less, nearly everyone loves a full bath on the first level.
- Two-car garage. The majority of prospective home buyers, 42%, want a two-car garage, more than double those that want space for just one car (18%), and those looking for a three-or-more car garage (12%).
- The suburbs win with location. This is clear with the top sought after aspects of prospective areas to buy a home in, which are walkable suburban communities with trails for walking and jogging, close to both parks and ample retail options.
Areas Where You Can Add Value
When looking for a new home, it’s a good idea to keep an eye out for untapped potential, namely areas where improvements will pay off with increased resale value.
- Exterior illumination. This top feature on the NAHB’s list is also one of the cheapest to install. A few hundred dollars can illuminate a home’s exterior in dramatic fashion, with walkway lights, pendant lights, and strategically positioned spotlights. It’s a small investment with an attention-grabbing payoff.
- Upgrades over revamps. While going all-out on a full upscale kitchen remodel may seem like a solid investment, Remodeling magazine’s data shows that kind of large-scale overhaul brings in a 53% return when balancing cost against added value. A more moderate kitchen upgrade brings in an 81% return. The same is true with bathrooms; conservative updates see returns in the 70% range while extensive remodels return 56% on average.
- Ceiling fans. Simple, energy-efficient, and comparatively cheap, ceiling fans are desired by the overwhelming majority (83%) of potential home buyers. Energy.gov says any rooms in which you install ceiling fans should have heights of at least eight feet.
- Energy Efficiency. From energy-efficient replacement windows to Energy Star-certified appliances, most buyers are looking for homes that don’t waste money with utility bills.
- Side-by-side kitchen sink. Most people want a double sink in the kitchen. You can install one for about $500 and have a kitchen feature that more than 80% of homebuyers want.
- Adding usable square footage. Square footage has a direct impact on home value; bigger homes fetch bigger prices. But beyond additions such as second stories, consider making existing space more livable. Building a deck or finishing a basement are two of the best ways to create more usable space. Patios and front porches are two of the most wanted outdoor features for buyers, according to the NAHB.
And if you’re wondering how to pay for these value-adding improvements, home refinancing may be the perfect way to use the equity you already have in your home to get the cash you need for home improvements.
And some things that may not add value…
There are some common misconceptions about things folks think add value to homes, but actually don’t.
- Swimming pools top the list; while pools can increase the value of a home by up to 7%, they also come with maintenance costs (and upkeep hassles) some potential buyers won’t want.
- Overbuilding, such as a second story in an area of one-story homes, won’t considerably boost the resale value if the home goes beyond the neighborhood norm.
- High-end upgrades are great — if they’re consistent throughout the house. A sleek new kitchen won’t move the needle on the resale price very much if that’s the home’s only major renovation.
- Wall-to-wall carpeting. Processed with chemicals and known to trap allergens — not to mention the cleaning issues — carpeting can be a turnoff to would-be buyers. Best to tear out the carpeting and put in wood flooring.
Ultimately, the features you want in your new home, and those you wish to add, are matters of personal choice. When you do find the home you desire, City Lending is here for your mortgage needs from purchase to home improvements.
