Six Worst Home Renovations That Will Not Get One Penny More Out of Your Home When You Sell

Published September 21, 2011 by Candy Evans

There is one phrase we are hearing a lot less of these days: ”We’ll get it back when we sell the house.”

Used to be, you could sink money into your home almost endlessly and rest assured it would come back to you, maybe even at a profit, when you sold. Buyers often have little vision to see how great a home can look, how it can change with new paint or minor renovation. So many agents advise sellers to have homes looking perfect, as if they were ready for a shelter magazine photo shoot. Perfect walls, floors, everything. Many sellers think they can create the rooms of their dreams and recoup the cost upon selling.

But there is increasing evidence that, these days, unless you keep those projects practical, you might be throwing good money down the toilet. According to Remodeling Magazine a solid front door is good while a tricked out master suite is bad: you won’t get 100% of your money out.

Is this true?

Each year, Remodeling magazine looks at the hottest home upgrades and renovations and then calculates just how much owners get back with they sell.

Not surprising that upkeep is more popular than upgrades these days, according to Remodeling’s Sal Alfano, editorial director. But prices and returns do vary regionally, he says, so what brings in more buyers in say Phoenix (um, weed?) may not be a must-have for the Dallas buyer.

Fr example, I think we are all about outdoor kitchens. I thought that would be a given in northern California, but it is not. Maybe that’s the “southern” touch in Dallas. But Cali buyers are much more into Feng Sui.

So what brings the lowest return when you sell? High-dollar, high-end and highly personalized add-ons that make you drool except — would you put your money there? A super luxe master suite addition — we’re not talking just bathroom and marble, we are talking sitting room with Yoga floor, coffee and wet bar: $232,062 to put it, you get out 52.7%. A sunroom averages about $75,224 to put in but do not count on getting more than 48% of that back. (I would think you’d do better with a sunroom in the north, not the south.)  An extra bathroom costs about $40,000 to put it — I always figure $50,000 when I look at homes because I like nice plumbing, but the experts say you only get 53 cents on the dollar back.

I disagree: give me a home in Midway Hollow with two bathrooms and you are pulling a higher sales price than a one-bedroom bungalow. 

Back up generators are great to play up the “safe from doomsday” scenario, but they cost about $15,000 to install and you’ll only net 48.5%.

Home office: I find this surprising, too. It costs about $28,000 for the average home office addition or finish out, and experts say they net only 45% of that. Of course, does anyone count in the deduction for the home office?

Then there’s the garage. I’m sorry, but I love a showplace garage. I have artwork in mine. Why oh why should you come into the same spot day after day to see ugly chaos? Super Dallas builder Cy Barcus got me thinking this way when I wrote about his personal home — his garage is pristine and beautiful, loaded with so much art it looks like a gallery. Oh and the doors are glass.

But the fancy-pants garage costs $90,053 and you get back 53.6%. That’s even better than a bathroom!

To summarize, the six improvements that rank dead last nationally when it comes to getting the dollars back at resale: home office remodel, back-up power generator (“doomsday is coming”), tricked out master bedroom suite, sunroom, a bathroom addition (I totally disagree) and fancy-pants garage with rubberized floors, car wash stalls, and antique gas tanks.

You know what other room I think we cannot live without in Dallas? The laundry room.

What do you think?

— Daily Local Real Estate Dish By Dallas Real Estate Insider — Candy Evans at CandysDirt.com