6 Home Renovations That May Hurt Your Home’s Selling Price

Beware of renovations that can actually diminish your home's value.

It's difficult to sell a home that's been customized with lots of color

When people renovate their homes, they often calculate how those renovations add to its resale value. Over the past several years, renovation costs have risen consistently while values have increased only half as often. A lukewarm housing market, rocky job market, and rising job costs have pushed back the payoff on remodeling projects.

While few homeowners actually recoup the full cost of home renovations, updated bathrooms, revamped kitchens and other cosmetic improvements can help make your home attractive to prospective buyers. The added bonus is, if you do the renovations while you live in the home, you get to enjoy the renovated spaces for at least a little while before it goes on the market.

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But beware of renovations that can actually diminish your home’s value. The degree to which they hurt depends. If the home is in a highly-desirable location, potential buyers may be willing to overlook purple walls and paneled kitchens. In a subdivision where many similar homes are for sale, the one with bad renovations may linger unsold. In general, real estate agents and design experts advise keeping resale in mind when you renovate, especially if you don’t plan to stay in the home forever.

“Renovations are always best done when they’re neutral and tasteful,” says Gea Elika, principal broker of Elika Real Estate in New York and a regional director of the National Association of Exclusive Buyer Agents. “Don’t personalize it if you plan on selling it.”

According to Remodeling magazine’s 2015 Cost vs. Value report, the home renovations that bring the greatest return when you sell are a new entry door, which brings you 101.8% of what you spend on the national average); the application of manufactured stone veneer (92.2%) and a garage door replacement (88.4%). The ones with the smallest return are a sun-room additions (48.5%), a home office remodel (48.7%) and an extra bathroom (57.8%). Before you get started on that family room addition, take a moment to consider its potential return.

Here are six renovations that may hurt your home’s selling price, or keep it on the market longer than you expected.

Converted garage
Some homeowners see converting a garage as a cheaper way to add more living space than building an additional room. But many buyers would prefer a garage, especially in cold and rainy climates.

Eliminating a bedroom or powder room
In older homes, combining smaller rooms in the shared living space might add to the value because today’s homeowners prefer large, open spaces. Eliminating a powder room, however, is a bad idea, and so is combining two bedrooms to create a large master suite. The elimination of an entire living space may result in smaller rooms and may not be financially feasible in the long term. You’ll probably get a better return on your investment if you built a wooden deck, instead of adding a sun room.

Heavy personalization
Ornate wall textures, detailed kitchen paneling, and sapphire blue walls may be a dream home come true for you, but less so for potential buyers. Some unusual features may be a turn off to potential buyers. Anything that is too personal or too specific runs the risk of losing its appeal to the broadest pool of buyers.

Too much color
If you love color, paint the walls of your home all the hues of a rainbow — and then paint over them in a neutral color when you’re ready to sell the place. Be aware that aqua appliances or neon tile does not appeal to most buyers. Color elicits an opinion of some kind, but no one has a strong objection to neutral colors. Even though you can paint over a bold color, the first impression of the house may be an undesirable one.

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