During the process of selling a property, sellers often face a common dilemma, are renovations necessary to achieve a successful sale? Renovations require spending additional time and money which can put many people off. However, at the same time most (if not all) sellers want to get the highest possible value for their property.
In this guide, we’ll explore the process of selling homes that may need renovations, we’ll consider key issues such as costs, budgeting, the type of property you’re selling and the impact of renovations on property value.
So if you’re currently on the fence of focusing on some minor touch-ups or carrying out an entire whole-house overhaul, you’re in the right place. Our aim is to help you achieve a successful sale without wasting any more time and money than absolutely necessary.
Let’s get started.
Can you sell a house that needs renovations?
The short answer? Yes. You can sell a house that needs a renovation. However, how much you can sell it for and who you can sell it to are different questions altogether.
You may assume that there won’t be any buyers interested if a property requires renovation. Some buyers actively look for fixer-upper opportunities. To them it may be an investment opportunity or the chance to start fresh and put their own personal touch on a property before moving in. These buyers often come with a willingness to invest time and effort into renovations, so a property in a bad state won’t be considered a bad thing. However, this will come at a price. Private buyers looking for fixer-uppers would be looking for good deals, this will result in a lower sale price for the seller.
Additionally, the buyer pool for a property in need of renovations is usually limited. The reason is most buyers prefer move-in-ready homes, where the only immediate task is unpacking.
So if you’re looking to appeal to both types of buyers, you need to make strategic decisions on the extent of renovations to carry out. The best way to do this is to carry out an analysis of other similar properties that have recently sold in the local area. Have a look to see what features those properties have that yours lacks and how in-demand those features would be for potential buyers.
Whole house renovation cost
You may be wondering how much you can sell your house for, and if you’re considering an entire house renovation, it’s definitely a wise idea to keep careful track of costs. House renovations are very hard to calculate accurately. There are many factors at play and a hidden issue in either one can bump up the overall cost considerably. In terms of numbers, there’s varying numbers out there but you’re looking at on average between £70,000 – £100,000+ for an entire house. Again, the varying difference is due to the many factors at play. Here are some of the major ones to be aware of.
Factors Affecting House Renovation Costs
Property Size, type and Layout
The size and layout of your home can impact the overall renovation costs considerably. Larger homes typically result in higher expenses, and the complexity of the layout can impact the ease or difficulty of renovations. For example, a bungalow property will be easier to renovate compared to a larger 4 bedroom property.
Scope of Renovations
The more complex and lengthy the renovation, the higher the cost. So it depends on if you’re looking at some simple decorating or a complex structural overhaul. If you’re looking to carry out work that is difficult, you’ll most likely require professional contractors to complete the work. This will increase the price just because there’s more people that need to be paid.
Material Choices
The materials you choose can also increase or decrease the cost of the renovation. So if you’re looking for high-end finishes and luxury materials expect to pay a much higher cost compared to more budget-friendly alternatives. The key here is to balance quality and cost-effectiveness.
Labour and Contractor Fees
The cost of labour and hiring a contractor is a substantial part of the budget. Skilled professionals with the best reviews usually command higher fees, but their expertise will result in a well-executed renovation free of issues.
Unforeseen Issues
Renovations can uncover unexpected issues such as structural concerns or electrical issues. Budgeting for these situations is wise to avoid any issues that can affect the rest of the renovation.
How to budget for a house renovation?
It goes without saying, you need to budget strategically and stick to the budget as much as possible. Here are some steps to ensure you can achieve this.
Start with the Most Expensive Work
Begin the renovation by identifying and prioritising the most expensive parts of the renovation project. This will usually feature renovation work like structural repairs, a kitchen revamp, or a bathroom remodel. Once these parts of the renovation have been completed, you will be comfortable knowing that the most expensive parts have been finished successfully.
Prioritise Essential vs. Optional Upgrades
Now although the first point was to start with the most expensive upgrades, it’s a good idea to also make sure they’re important. While it may be tempting to carry out renovations that are just aesthetically pleasing, you will need the budget for the more serious issues that will prevent your property from being sold. So make sure your budget is allocated to improvements with the most significant impact on your property’s value.
Get Multiple Quotes
Before you begin work, ensure you get comprehensive quotes from multiple contractors. This will help give you a good understanding of the trade market. This will also help prevent you from over spending. However, this doesn’t mean that you select the cheapest option. If possible request reviews and the opportunity to visit similar work that they have completed in the local area. This will make sure you avoid paying twice.
Shop Around for Materials
Similarly, don’t settle for the first materials you come across. Visit different suppliers to find competitive prices without compromising quality. Nowadays, you can gauge prices online relatively easily. However, visiting stores in person can help you find great deals. It doesn’t matter what you’re purchasing, be it new doors, flooring, or paint, saving money across everything can result in a higher ROI.
Create a budget for the budget
Unforeseen issues are an unfortunate part of renovations. So make sure you have some money set aside for any issues that may crop up. Typically, that should be around 10-15% of the total budget. This will help to ensure you don’t face any unnecessary financial stress when completing the renovation.
Difference between minor and serious renovations
Many people carrying out a renovation for the first time can get confused between the difference between minor and serious renovations. It;s important to get this right to avoid spending money on unnecessary work that won’t have a real impact on the value of the property.
Minor Renovations
Minor renovations typically revolve around cosmetic changes that enhance the aesthetic appeal of your home without major structural alterations. Examples include repainting, updating fixtures, or replacing flooring. While these improvements can substantially increase your home’s visual appeal, they will have lower costs and shorter timelines to complete. In terms of ROI, it’s more beneficial from a marketing perspective to entice buyers. .
Identifying Serious Renovations
Serious renovations, on the other hand, involve more extensive work to be carried out. This often involves structural changes or significant upgrades. Examples may include overhauling the plumbing, electrical rewiring, or undertaking major structural repairs. Serious renovations tend to require a higher budget and a longer timeframe to complete. Usually, the ROI for these is likely to be higher. If a property needs these serious renovations urgently, buyers are unlikely to pay a premium without them completed.
DIY vs. Professional Renovations
When it comes to renovations,many people assume they can do it themselves (DIY Route). However, unless you have time and more importantly the ability to complete the renovation, hiring someone is usually always the best choice. Let’s take a look at some pros and cons if you’re not sure.
DIY Renovations
Pros:
- Cost savings – DIY projects will save money on hiring professionals.
- Flexibility – You can work on your own schedule.
Cons:
- Time-Consuming – DIY projects may take longer, especially if you’re learning on the go.
- Quality Risk – Lack of experience can impact the quality of the work. Sometimes, you may end up having to pay a professional.
Professional Renovations
Pros:
- Expertise – Professionals bring experience and skill to the project.
- Time-Efficient – Pros can complete the work faster, minimising disruption.
Cons:
- Higher Cost – Hiring professionals generally comes with higher labour costs.
- Dependency – You rely on others to schedule and complete the work.
With these pros and cons considered, the most important thing is to assess your skills. Be honest about your abilities. If a project requires skills beyond what you can manage, it is always better to hire professionals. Next, take into account your budget. Carrying out work yourself will need investment into tools, materials and equipment which can add up. So compare these costs and the value of your time compared to quotes from professionals. Additionally, take into account the project complexity. Simple projects like painting will be suitable for DIY, but complex tasks like electrical work or plumbing are better left to professionals.
Tips for selling a house that needs renovations
If you’re leaning against carrying out renovations yourself, you can still manage to get your property sold. Here’s some tips on how you can achieve a sale.
1. Highlight Potential
During viewings be proactive about emphasising the potential of your property. Communicate how minor renovations can transform the space, allowing buyers to think about the possibilities.This will require you to hone your sales skills.
2. Make the Property Appealing
How you stage the property can make a significant difference. Depersonalise the space, declutter, and focus on showcasing the unique aspects of each room to help buyers see the space’s potential.
3. Be Transparent
Be upfront about the property’s condition. Transparency builds trust and helps remove any doubts or questions from the buyer’s mind. Outline the renovations needed and any ongoing or completed work.
4. Set a Realistic Price:
Another important part of getting the property sold is the price. It’s important to be realistic. If renovations are required, it’s almost impossible for a buyer to willingly pay at or above market value. So accurately price your property based on its current condition and the renovations required.
5. Market to the Right Audience:
Identify your target audience. If your property is ideal for first-time buyers or investors willing to undertake renovations,ensure you can get your property in front of them to consider.
Which renovations can increase the value of a property?
There are specific renovations that can increase property value. If you’re looking to complete a renovation with the ultimate goal of selling – it makes sense to focus efforts that can achieve this goal.
The first thing you need to do is compare your property to similar properties that have recently sold in your area. Find out what the most attractive features are and aim to get your property in a condition that can compete with those.
No two properties are the same. However, some things are universal. For example when it comes to painting, neutral colours are always better than bright, vibrant colours.
Here are some more renovations that can increase the value of a property:
Kitchen Upgrades
Investing in a modern, functional kitchen is often a great choice. Kitchen styles change every few years and the newest trends are likely to entice potential buyers. Focus on aspects like upgrading countertops, cabinets, and appliances that can add both aesthetic appeal and value.
Bathroom Remodel
Similar to the kitchen, upgrading the bathroom can greatly influence a buyer’s decision. Again, focus on modern designs that appeal aesthetically to potential buyers.
Exterior Enhancements
First impressions matter. Improve the exterior appeal of your property by focusing on things like the garden/driveway essentially updating the entryway.
Renovations can certainly help achieve a successful sale However, the most important thing to consider is to compare the expected increase in value with how much time and money it will cost to get it sold. Especially when a property can still be sold without any need for renovation and the difference would be the cost of the initial renovation.
For example, you may receive a property through probate. You already have another property and want to get it sold. However, now you need to spend time and money to renovate the property to get it sold. That’s a costly process, initially. What if there was a better way?
Here at Sold.co.uk we can get your property sold no matter what condition it is in. We have an extensive network of potential buyers who are interested in all types of property. Simply get in touch to receive an offer for your property.
