Readers of Rich’s Corner are all about frugality. So why is there an article about spending money? Because there are many instances where spending some money now can earn you plenty of money later.
No, this doesn’t involve gambling or picking stocks. Those can lose you money just as easily. Instead we’ll focus on something you own, and which you can help appreciate in value. When it comes time to sell your home, will you be able to capture maximum value?
When looking for improvements to make around your home, there is one key point to keep in mind: aesthetics go a long way. You might make your home more energy efficient by installing better insulation in the attic, and a meticulous buyer will certainly take note. But the average buyer is more interested in how they imagine the house when they own it. Making it more aesthetically pleasing will help them with that image.
When we moved to a new state, my wife and I spent time looking first at rental properties before we got ready to buy a house. When touring an apartment we liked in terms of price and location, we were instantly turned off when we got to the bathroom. It looked like it hadn’t been renovated in years. The toiled appeared to have suffered a decade of abuse. The tile was grungy. The bath tub — we won’t even mention the bath tub.
If we walked away from an otherwise great apartment rental because of the bathroom, imagine the reaction of a prospective home buyer. Do you think there’s any chance they’ll buy a house with a subpar bathroom? They might have the opportunity to remake it, but that is 1) expensive, and 2) leaves too much to the imagination. A quick bathroom renovation can go a long way in helping sell your home.
A new vanity really brings together a bathroom, but it can get expensive. A new toilet can be expensive, but is absolutely necessary. But you know what is reasonably priced and can make all the difference in your bathroom? New floor tile. If you google around, and trust your technical skills, you can even install it yourself. (If I can do it, I’m sure most Rich’s Corner readers can as well.)
The difference is noticeable. Instead of walking into a bathroom with old tiles, or worse, linoleum, you’ll get a clean, fresh, modern look. And you won’t spend a lot of money attaining it.
Yes, carpeting can be expensive. You have to buy more than enough to cover the room, just in case there are any odd angles. You have to lay down tack on the perimeter, and make sure that the tacks don’t stick up through the carpet. You have to cut, lay, cut, and press it down. In short, installing new carpet is a huge pain. At the same time, you don’t want a prospective buyer to see your old, trafficked carpet.
The solution is to rip up your old carpet. Don’t replace it. Instead, focus on the hardwood floors. While carpeting can be practical, hardwood floors can be beautiful. It will take a bit of sanding, and you’ll have to finish them, but it won’t take as much time or effort as installing carpet. Then you can sit back and admire your beautiful floors.
Prospective buyers will love it, because it allows them to imagine the room exactly how they see it. Instead of seeing your dingy old carpet, they’ll see your marvelous hardwood floors. Throw down a few area rugs, and you can throw in even more suggestion. It might seem counterintuitive, since carpeting is pretty common. But it does make a huge difference.
Go into any old basement and you’ll probably see the same old sights and smell the same old dingy odors. While basements can be great for storage, they can serve other purposes as well. In fact, there might be no better use for the basement than to turn it into another room. Finished basements really capture the attentions of home buyers.
Think that you’ll spend a ton of money finishing the basement? You will, but you can also recoup much of that money. For staters, all the furniture you place down there will come with you. On all the other improvements you can earn up to a 150 percent resale value. That is to say, if you spend $10,000 finishing your basement, you can increase the value of your home by up to $15,000.
Don’t have a basement? Fret not. Adding or upgrading another room to your house can have a similar effect on resale value. That is, the more rooms you advertise, or the nicer the rooms look, the more money you can get from a sale. Plus, you’ll be able to enjoy the room while you still live in the house. So it’s a win now and a win when you sell.
Spending money on home improvements might not seem frugal, but if you’re even pondering a sale they can go a long way in obtaining you more money. Enjoy the improvements for yourself now, and enjoy them again when you get a higher total for your house when you sell. That sounds frugal to me.