Repairs
TLDR: Do routine maintenance tasks yourself, but hire a licensed and insured contractor for major repairs or improvements. Don't make cosmetic improvements unless you're confident that they're stylish.
Deciding whether to conduct repairs yourself or outsource depends on a variety of factors: how much time and money you have to spend on remodeling, how many repairs need to be done, and what type of repairs you intend to do.
Conducting smaller, routine maintenance tasks can be done yourself to save money. Patching holes, changing out lightbulbs, and oiling squeaky doors are all low-cost activities that you can do to improve the appeal of your house. The answer to who should complete larger home renovation projects is not quite as straightforward.
To Renovate or Not to Renovate: Beware of the Conflict of Interest
Many an agent will recommend that sellers renovate a house before selling. While renovations do, in fact, increase the value of the property, there is a clear financial incentive for agents to advise this (the increased home value results in a direct increase in commissions). However, what's less clear is whether you'll receive a return on your renovation costs.
Example
If you spend $20,000 on a kitchen renovation, you may receive offers that are $20,000 higher than what you would have otherwise received. Conversely, if you didn't renovate kitchen, you could have saved yourself the hassle of renovating a kitchen and still have netted the same amount. If you're putting in the elbow grease and keeping costs low by conducting the improvements yourself, you're more likely to see a return than if you hire externally.
One way to gauge whether renovations will be worth the cost is to evaluate recent home sales that include the renovations you're considering. For more on this, look at our Decide on a List Price section.
Storytime
"Read the feedback provided by buyers who walk through your house. We were selling a 5 bedroom, 2.5 bathroom house with all five bedrooms on the second story–a convenient layout for a family with many children. By reading the feedback, we learned that our difficulty selling was due to the absence of a bathtub on the second floor; the kids' bathroom had a walk-in shower instead of a bathtub, a renovation that was made after the current owners' four children grew up. To acknowledge the deficiency, we included a $5,000 credit for any buyer who wanted to repurpose the second bathroom to include a tub. Much to our pleasure, the credit worked, and the house was sold shortly after to a family with five children.
Should I make cosmetic modifications?
First, let's clarify what we mean by cosmetic: modifications that don't involve any structural work and are mostly appealing to the eye. The answer here, as so often seems to be the case, is "It depends."
Unless you have an eye for design or can do a good job of replicating what's trendy from magazines, HGTV, etc., we recommend not making any cosmetic decisions such as painting, floors, and kitchen or bathroom improvements yourself. Too often we've seen sellers make "improvements" to the property, only to have the buyers despise the paint color or flooring selected. If you’re set on making cosmetic renovations, look at trends to find what buyers like to ensure your investment doesn’t end up wasted.
Fixing the Fundamentals
While you may opt out of making cosmetic renovations, buyers expect the bigger ticket items such as the HVAC unit and roof to be in working order. If these things aren't operational, we'd recommend having them fixed (by a licensed and insured contractor, not your third cousin once removed who needs some extra cash) before listing the property for sale to allow buyers to focus on the house instead of the major deficiencies. If you can't afford to make the repairs, you'll likely need to reduce your property's asking price to offset the cost to the buyer to get these things in working order.
Storytime
“A property we once listed had recently been “improved” by the seller. He painted the walls yellow and had gray wood floors installed, both of which buyers universally hated. Unfortunately, he didn’t spend any time or money on the two areas that buyers care most about: kitchens and bathrooms, which were old and in disrepair. We had difficulty selling that property until we offered a credit to buyers for improvements to the kitchen.”
What if I did the repairs myself?
If you can, we'd recommend hiring a licensed and insured contractor to confirm that the work you performed is up to code. It’s better to know now than after the buyer's inspection when major repairs could delay closing.