Quote:
Originally Posted by SensibleChiefsfan
I always tell my clients and homeowners that I work with that you do upgrades for yourself, not to get a return on your investment.
The one caveat is that if something needs replacing, the cost to upgrade versus replacing with the same quality is typically much less. At those times, it 'may' be beneficial to spend the extra money to upgrade.
Unless you buy a house below market that needs rehabbed, or unless you are in a high demand area with older homes, you will not see a dollar for dollar return on your investment when you upgrade a home or finish the basement.
In the past, just normal appreciation would allow you to recoup your investment. However, I believe appreciation will happen at a much lower rate going forward than it happened in the late nineties through 2005.
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You need to call HGTV. They're hiring the wrong real estate experts. They tell how much they spent fixing up a room, and the realtor usually tells them what they can expect to get back for it. It's usually always higher unless they've overspent on kitchens, bathrooms, or lighting.
Or they urge people to buy houses with unfinished basements telling them they can get they're money back, plus some.
Even last night, when a couple renovated a basement apartment, some appraiser said it added $100K onto the worth of the house.