Essential Home Updates

What Updates Make Sense when Looking to Sell or Rent Your Home in Minnesota

We often get questions from homeowners who are looking to sell or rent out their property wondering what items they should fix and how much money they should invest in the home before putting it up for sale or onto the rental market.

Let’s look at the first option: You want to sell your property and you are debating what work to do to your home. Maybe your home has older windows and an outdated kitchen and carpet. In other words, the property could use a little work. So should you sell the home as is or should you spend thousands of dollars on various updates?

In our local Twin Cities real estate market, with almost 33,000 homes on the market, properties that are “dialed in” most assuredly are the ones that are selling more quickly. With buyers having an abundance of homes to choose from, they are becoming more and more picky.

First and foremost, paint and carpet are essential. Putting some fresh paint on the walls and new carpet in the home will go a very long ways and give you a great “bang for your buck.” In addition, kitchens sell home. Updating the kitchen is essential. When it comes to more expensive items such as siding and windows, buyers in our local market are expecting those items to be of good quality. In other words, if your windows are out of date right now and failing, don’t expect to get the same dollar out of the sale of the home as you do for money you invest in purchasing new windows. Same goes for siding as well.

When in doubt, make sure the home is professionally cleaned. If you have the money to fix some of the major items (siding, windows, etc), I would also encourage you to fix those items as well. However, remember that various updates will provide various rates of return. In general, remember the current supply of homes is giving buyers such an abundance of choices. However, if your property is priced correctly and shows well, it will sell.

Now let’s consider the second option: you are looking to rent your property. When in doubt, remember that renters too are “normal” people. We all have rented properties at some given point in our lives. Some of us still currently rent, and many for some very good reasons.

It goes without saying, the nicer, more up to date homes are going to be easier to rent. However, don’t feel like you need to “break the bank” with updates in order to get it rented. With the tightening of the credit markets, more and more people are looking to rent. This is creating a great demand for rental homes in all price ranges.

I have found through personal experience, cleanliness is the most important item for a rental home. If the home is clean, it will rent. It does not need to have new carpet, new features, etc. A home will rent when it is clean and the rental amount you are asking is priced correctly.

As we know, renting your home allows you to weather a slower resale market and sell when the Twin Cities market rebounds. When you do look at selling, I encourage you at that point to really look at updating the home. For resale, it will allow you to sell the home for the highest dollar amount. However, if you are looking to rent the home, make sure it is clean and the rent is priced fairly. Don’t break the bank and replace carpet, etc right now before the tenant moves in. Give it a couple years after the tenant has been in the home. You may need to replace the carpet sooner than you want anyway?!?! That too is unfortunately the voice of experience!

In both cases, selling and renting your home, there are pros and cons to various levels of updates. Remember, talk to your real estate agent and get the advice of a professional!