10 Home Updates to Skip Based on ROI
A couple weeks ago, I posted 10 home updates that actually pay off and add value to your home, in terms of resale value. It ended up being a popular topic, so I figured it might be helpful to share the flip side of that post as well! Today, I’ve got 10 home updates to SKIP or be mindful of, based on return on investment (or ROI). If you’re not in your forever home and are planning to list your house someday, you might consider skipping these improvements or at the very least- understand that while these updates may bring you happiness, it’s a cost you should weigh. Click through to see which renovation projects won’t add value to your home when it comes time to sell.Â
The following is based on the average market and home buyer. Super high-end properties could be the exception, but these are general rules to keep in mind based on the National Association of Realtors studies. I’m not saying don’t make these updates… it’s your home and you get to decide how you want to update it, so you can enjoy it, but this is good info to know from an investment point-of-view. I feel like there is a common misconception that the money put into a home renovating, will come back out when it’s time to sell. Ready to dive in? Let’s do it!
#1 // Hobby Specific Rooms
While hobby specific rooms sound great in theory… a custom craft room, state of the art home gym, or fancy wine cellar will not be a cost you’ll recoup. Potential buyers have a difficult time visualizing other uses for very specific, niche spaces. It’s best to keep extra rooms styled as bedrooms for the average home buyer.
#2 // Over Renovating
This is a tricky one…. Emmett and I were almost guilty of this while updating our previous home. We loved our location and wanted to add-on so badly, but it just wasn’t a smart financial decision, because we would basically be throwing our money away. Projects that are too costly for your location (overly high-end or customized) are not a good investment. It’s important to compare your home to others in your neighborhood, study comps, and set a specific budget for your renovation. Someone once told me, your home is only as valuable as its surroundings. That has definitely stuck with me!
#3 // Swimming Pools & Spas
While I’d LOVE to have a swimming pool during the hot Utah summer (just look at me living my best life in France– poolside with rosé), a pool or spa does not appeal to the average buyer. It’s often viewed as a hazard for children & pets, and also requires a ton of upkeep and maintenance to enjoy. Installing a pool or spa is an update that will not increase the value of your home. However- it might increase your happiness! It’s one of those things you should carefully consider. How long do you plan to live in your home? If the answer is 10+ years, it might be the right choice for your family… just don’t expect to make more money if you add a pool.
#4 // Carpeting
Carpeting is not a good idea in terms of resale value. According to data from the National Association of Realtors, 55% of home buyers will pay more for updated, hardwood flooring ($3k+). 90% of buyers said they prefer hardwood flooring as opposed to other types and are willing to pay a premium. Carpet tends to turn off the average buyer. It holds dust, allergens, can trap odor, and isn’t right for everyone. The previous homeowners had carpet installed from wall-to-wall (even in the bathroom!!) before we moved in. While I was happy it was clean and new, I would’ve rather ripped out the old and replaced it with the flooring of my choice.
#5 // DIY Projects That Look Amateur / Poor Craftsmanship
DIY projects that look amateur (or won’t hold up over time because of poor craftsmanship) is an immediate red flag for buyers. You guys know I’m a big advocate for DIY, but it’s very important to know your skillset and when to hire a pro. It can be quite a financial gamble to tackle home projects you’re not capable of doing a great job on. Craftsmanship is a big deal and shouldn’t be taken lightly. During our home buying process, it absolutely killed me to see “flips” that were terribly done.
#6 // Too Much Wallpaper
Although I’m a huge fan of wallpaper, there is such thing as “too much wallpaper” for home buyers. Wallpaper is tricky because it’s very taste specific. My wallpaper preference might not be the same as yours and vice versa. It’s an intimidating feeling to walk into a home filled with wallpaper in patterns you hate… your brain immediately thinks of long hours that accompany a wallpaper removal project. Wallpapering the ceiling in our old hallway was honestly a gamble. I’m glad the current homeowners were into it! The hard work of removal seems daunting to most buyers. If you’re going to wallpaper, maybe opt for a bold or colorful pattern in a removable option… or stick with a safe textural choice, such as grasscloth.
#7 // Garage, Carport, or Sunroom Additions & Expansions
Emmett would LOVE to build another garage or workshop. No matter what size workspace or garage we have at any point in time, it’s never good enough for that man. Haha! He would build a six car garage if I’d let him. He loves tools, man toys, tinkering, working in the shop, etc. However, it’s not a smart investment to expand a garage. Other bad decisions in terms of ROI? Adding a sunroom or carport additions. These outdoor add-ons aren’t a smart investment. If you already have a carport, sunroom, or garage that could use some TLC… that’s a totally different story! Remember my old carport makeover?
#8 //Â Invisible Improvements
Invisible improvements are a tough sell. While they’re necessary, we typically don’t see a good ROI. In our current home, we’ve had to replace two hot water heaters, and eventually 100% of our plumbing will be replaced as we continue to renovate our home. While it’s wonderful and imperative in creating an efficient, functioning house, it’s not something buyers appreciate or are willing to pay top dollar for. We bought this home knowing (thanks to a detailed inspection) that these items would need to be replaced eventually, so we were able to negotiate with the homeowners. When it’s all said and done, even with negotiation- we’ll still lose money on the invisible improvements we plan to make. What lies behind closed doors or walls typically isn’t as valued.
#9 // Family Outdoor Extras
Outdoor extras sound super fun… especially for families with kids, but they definitely don’t add value to a home. Updates like a custom playground, in-ground trampoline, or a fancy tennis court is not a smart project to tackle from an ROI point-of-view. A budget-friendly outdoor cleanup project? That’s a better idea! Remember when we transformed our side yard to extend our outdoor living space? Curb appeal has a great ROI!
#10 // Swapping Your Only Bathtub for a Shower
I’ve talked about this one before and it still holds true. If you only have one bathtub in your home, by all means- keep it a bath! I’ve seen too many people replace their outdated bath with a shower for the sake of saving space and creating a “nicer” bathroom. This will lose you a lot of money when it comes time to sell. It’s important to have at least one functioning tub in your home. If you have a bathtub and are renovating a different bathroom under the same roof? By all means- install a shower! As long as you have one tub, you’re golden.
There you have it! 10 projects that aren’t smart in terms of resale value or when thinking of return on investment. Do you have any others to add to the list? Questions? I’d love to help! Leave them for me in the comment section below! I’m not sure about you, but I find all of this super fascinating.