Turnkey or renovate, that is the question

Whether to update or to renovate part or all of a house is a decision that often faces both buyers and sellers. Those looking to sell try to figure out if that investment will help sell their property, and if so, for how much of the cost will they be reimbursed at the closing table.

At the same time, buyers are calculating what it’s worth to them to take on a property that requires work versus buying a similar property that already has those updates. There is the monetary element, but also the time and often uncertainty about local contractors, permits, zoning and the like. Obviously there are varying tolerances for renovation. Since my market is primarily the second home buyer, they are often particularly hesitant to take on a bigger project given the time and distance elements.

So what does that mean for sellers? In my experience over the last few years, I have usually advised my sellers not to upgrade kitchens and bathrooms because tastes vary so widely, and because buyers are more comfortable dealing with countertops than the septic, for example. What sellers should focus on is minimizing the list of repairs/upgrades required for the house’s systems. Those elements can scare people who are more accustomed to apartments than houses.

Recently I was chatting with a couple who lives in Long Island, and she mentioned that she put in a gorgeous kitchen to help sell her house, but lamented the fact that she had little time to enjoy it before handing over the keys to a new buyer. And this brings up the point that if you’re contemplating selling in the next few years, and your kitchen or bath could use an update, do it and enjoy it, with the knowledge that down the road it will likely help the marketing and sale of your home, although you might not fully recoup the cost.

Squatters I came to know during a 2007 house flip.