Knowing what type of remodeling investment to make for the biggest return on a home sale comes down to much more than selecting a shade of paint.
It’s all about the local housing market, says Amanda Valente of Renovation Sells.
Valente, chief operations officer, helped start Renovation Sells in 2018. The franchise remodeling company operates in 36 markets, with all design centralized in its Chicago headquarters. Renovation Sells offers refreshes, where no structural changes are made, primarily working with agents and their sellers to prepare homes for the market and deliver a higher closing price. It also offers services to homeowners not in the market.
A refresh includes anything from painting kitchen cabinets to replacing countertops, flooring and appliances. Valente said a typical project runs $40,000 but could promise a 50% profit for sellers. Some sellers prefer to place their home on the market without the trouble of a remodel, but others, such as aging adults and separating couples, could benefit from the return on investment, most, she said.
“We find people in transition are the most apt for getting extra profit in their home. … This is a big asset and they’re not going to have an opportunity to make more money again,” said Valente.
But despite Renovation Sells' nationwide reach, knowing how to design a remodel with a solid return on investment requires mastery of the nuances of a local market, understanding comparables and potential buyers.
Between data from projects and insights from local franchises, the design team works closely with the client and agent to understand who might buy the home and at what price, determining the type of investment to make and the design choices to select.
Part of the process involves scouring listings comparable to a seller's home, seeing the design and quality of those kitchens and bathrooms, and what's selling swiftly versus what's lagging on the market.
In a Colorado project, Renovation Sells is designing a kitchen with earthy colors and materials, using taupe on the cabinets and a contrasting black granite on the countertops with brass and gold finishes. In the East Coast or rural areas, the firm is less likely to specify brass finishes, finding that the buyer pool prefers more traditional styles.
“We work very closely with our Realtor partners to help guide us. … Maybe one home is only a $20,000 project, but another needs $100,000 worth of work. It really depends on the home, size of the home and what the market is actually calling for,” said Valente.
Valente suggests that a home value below $300,000 is better for a do-it-yourself project based on the potential return on investment, whereas a home priced $500,000 and up could reap the benefits of hiring a professional.
Valente and her team met with Homes.com to share Renovation Sells’ tips for remodeling a home to maximize its return on investment.
The interviews have been condensed for clarity.
Why refresh?
"A lot of what a refresh does is give the impression that this home was cared for, because when seeing a house, you don’t yet know what’s behind the walls,” Valente said. “If you go in and the carpet is old, it’s on you to then think, ‘Well, maybe down the line I’ll renovate this or that,’ but if it’s done for you, it can look good and give an impression that the home was cared for, " Valente said.
"It’s fresh and clean, so someone can live here a few years before taking on a remodeling project."
How do you determine what design choices to make in a refresh?
We want it to look like someone could move in and then decide to make it their own.
“Area has a lot to do with it and the type of property,” added Renovation Sells designer Eric Drozd. “Let’s use Chicago as an example. The two-bedroom in Bucktown is probably someone younger, someone like a professional buying a property, where if you’re looking at a five-bedroom house in Northbrook, that is a family, someone older, that’s a whole different type of buyer. … We make the house look like it should be for that target buyer … If a house is dated and maybe a 30-year-old won’t like that, we can design it for them to like it.”
What materials are popular choices for a refresh to sell?
“We take into account the architecture of the home to make sure we’re not totally off base, but an older buyer would probably lean towards things that are a little bit more traditional/transitional, a little bit more neutral,” said Renovation Sells designer Anna Christoffel. “We would focus on selections that cater to that, whereas maybe a younger family or younger single buyer, maybe more open to something a little bit more designed forward.”
“[Luxury vinyl plank flooring] has been pretty big for our purposes. It’s a great material, very universal, and particularly for seller projects, it’s a material that can oftentimes go over the existing flooring. … Anytime we can create a consistency in flooring, LVP is usually a great, very budget-friendly option that looks great.”
“In our world, a lighter quartz is super popular because most will have a dark granite, and it’s just a really nice change. It’s a dramatic before and after,” said Drozd. “That said, we love a leather black granite because it feels more natural and it doesn’t look like granite.”
What do you commonly refresh in a kitchen and bathroom?
“Our most typical projects are kitchens because kitchens are the first thing people see when you’re going for sale. We’ll paint the cabinets, change the counters, do the lights, change the hardware, the faucets, and we do a lot of flooring and painting,” Valente said.
“In a bathroom, we’re not going to move a tub, but maybe we’ll spray it and make it look fresh and new. We’ll replace vanities in place because everyone wants something that feels new and fresh when they’re going into a home that they probably want to buy,” she said.
What should sellers prioritize refreshing before listing their home if they want to put little effort in?
“A good thing for sellers to look at is what looks worn down,” Valente said.
“If your cabinets are in great shape, maybe you only change your counters. If your cabinets are in awful shape, let’s paint them or replace the doors. People don’t want to see something that’s worn down and used. Look for the most well-loved places that could look improved,” she said.