3 Home Improvements That Yield a Return on Investment When Selling

There are only three home improvements that are proven to yield a return on your investment when you go to sell your home. Let's see what they are:

1. Replacing the hardwood floors. Now, this makes sense to me because as a home buyer walking throughout the house everywhere you go, you're seeing the floors, the living room. "This is lovely. I love the configuration, but the floors!" and " What a nice and open dining room, but those floors. Look at the master bedroom. It's huge. And like walk-in closets are lovely, but those floors, again." It's just a constant reminder and it is very important to them.

2. Replacing the roof and 3. Replacing the HVAC.

These also make a lot of sense to me because as a home buyer, no matter where the seller has priced the property, they're going to be looking at that HVAC or roof and say, well, that's going to take a lot to fix I'll offer them $10,000 less.

So even if, as the seller you've priced it 10,000 below, 5,000 below to make up for the HVAC, the home buyer's going to look at the house and they're just going to drop the value in their head and want to offer less. They don't want that upfront cost for something that's not even a fun project.

Now, the crazy thing I see looking at this study, it's a large NAR study survey of different home sales throughout the country, is that apparently 40% of realtors recommended replacing a kitchen. Which is crazy to me for a few reasons. First of all, it yielded a return of investment of 50%, meaning that if you spent $50,000 replacing your kitchen, you would get $25k back.

You literally lose half the money that you put into the kitchen, and 40% of realtors recommended this. This that means 40% of realtors walked into somebody's house and said, "Oh, you just need to take out this kitchen and put a whole new one in", and number two, they admitted to it in a survey.

Finding a realtor who you're going to work with on listing your home, you need to make sure that, you know it's somebody with experience and also hopefully some sort of credible viewpoint as to what actually improves the home from a buyer's prospective. Not every Realtor has to be a designer as well, or an investor, certainly helps to have some of those credentials, but you do want to make sure that they are speaking from a place of knowledge and experience, and even simply keeping you in mind, because just coming in and saying, "This kitchen needs to go." is not going to help... virtually ever.