What's a home worth?
Homeowners and house-hunters may be overwhelmed by the amount of information (and misinformation!) out there as they attempt to answer that question. The best course of action is always to utilize a reputable realtor to provide a Comparable Market Analysis (CMA) for a real time market value of their home. Of course, in the end, a home is worth what a buyer is willing to pay for it.
But how much would you pay? Or how much are you willing to sell for? Those are the questions that many Bucks County residents must ask themselves as they enter the housing market. And given that a home is often a family's largest financial investment, the savvy house hunter will do their work to arrive at the best possible answer, to make the right moves at the right time.
So how does one even begin to arrive at the “right” answer? To help local residents weigh that decision, we're getting advice from local experts on both sides of the spectrum – leading Bucks County realtor Jacqueline Hillgrube, and expert Bucks country residential contractors Steve Bohn and Michael J. DeMaio of Milex Residential.
Do the math: Not all home improvements are created equal. If you're purchasing a fixer upper, bring in an actual contractor to get a quote on the projects you plan to take on. A simple budget will help you gain clarity on whether that “fixer upper” is a steal or a sinkhole.
This is also an important step when weighing luxury real estate, which often includes top-of-the-line features. “This is where buyers will often uncover hidden value when purchasing existing luxury accommodations, rather than taking on a new construction project,” informs Jackie. For example, one of Jackie's recent listings, the 16,000 square feet estate 5 Knowles Creek, boasts exquisite details like Schonbek chandeliers, Kolbe windows, custom Enkeboll wood moldings and panels, 6 bay garages, and a 1500 square foot gourmet chef’s kitchen.
“New construction in the luxury market will be $400 to $550 per square foot. Resale is where the savvy buyer will have the opportunity to pick up details not delivered by the builder for a marginal cost of $180 to $350 per square foot,” explains Jackie.
With timeless luxury finishes already in place, a homebuyer is able save both time and money.
Still not sure how to value those projects? Turn to the comprehensive Remodeling 2017 Cost vs. Value Report, an annual report that actually breaks down dozens of home improvement projects, both at the mid-range and luxury level, to to determine how much value is driven by each improvement. Even better, since that value can majorly swing by region, the report breaks down that data at the local level to help both buyers and sellers access the most relevant information. For example, at the high-end level, a garage door replacement will yield an 88% return on investment on average. Check out key remodeling trends hitting the Philadelphia market in 2017.
Understand the intricacies of the market: Whether buying or selling, take an afternoon off to tour other homes in the neighborhood, preferably with a knowledgable agent on hand. Subscribe to MLS's Zip Code-specific email updates to track all of the latest deals in your neighborhood. Specifically pay attention to pricing, days on the market, and amenities – which are most available and which are largely missing from the current market. Knowledge is power. A prepared buyer will know when to swoop in with an offer, especially in today's competitive landscape, and an educated seller will set up their listing for success.
Michael J. DeMaio of Milex Residential suggests engaging with a local general contractor who has a knowledge of the local market to determine whether or not a renovation project is fiscally in line with the homeowners goal for the property.
“A first time home buyer‘s renovation project priorities may want to be geared towards possible resale value of the home. On the other hand a family that has just purchased their dream home may want to focus on their families quality of living.”
Regardless of the situation, Milex Residential is available for consultation throughout the Bucks County region to determine if the home owners project budget is not only realistic, but aligned with their goals for future.
Be honest with yourself: What details are most important to you? Do you have the time and interest in taking on home projects? How long do you want to live in this home and what will you need in the future? Does a great location seal the deal? As we said early on, the value of a home is ultimately what a buyer is willing to spend so you must understand your own priorities to arrive at a price you won't regret. For example, if one of your priorities is living within walking distance to shops and restaurants, that extra $50/month mortgage payment will feel well worth it when you're strolling into town for coffee on a sunny spring day.
Of course, bringing in local experts is always the best bet before you make any major financial decision. Contact Jacqueline Hillgrube for Bucks County real estate advice at 267-716-2814 or Milex Residential for all of your residential home contractor needs at 215-245-1685.