The Top Home Remodeling Investments

Click Here to see the Top Options for Seattle Area Remodels or click the map below to search by national region. Unfortunately, unlike in some area of the country, remodeling cost compared to return are still taking a downward turn in western Washington.

Owners Recoup More with Exterior Home Projects

As part of the 2010-11 Remodeling Cost vs. Value Report, REALTORSÒ recently rated exterior replacement projects among the most cost-effective home improvement projects, demonstrating that curb appeal remains one of the most important aspects of a home at resale time.

“This year’s Remodeling Cost vs. Value Report highlights the importance of exterior projects, which not only provide the most value, but also are among the least expensive improvements for a home,” said NATIONAL ASSOCIATION OF REALTORSÒ President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “Since resale value can vary by region, it’s smart for home owners to work with a REALTORÒ through the remodeling and improvement process; they can provide insight into projects in their neighborhoods that will recoup the most when the owners are ready to sell.”

Nine of the top 10 most cost-effective projects nationally in terms of value recouped are exterior replacement projects. The steel entry door replacement remained the project that returned the most money, with an estimated 102.1 percent of cost recouped upon resale; it is also the only project in this year’s report that is expected to return more than the cost. The midrange garage door replacement, a new addition to the report this year, is expected to recoup 83.9 percent of costs. Both projects are small investments that cost little more than $1,200 each, on average. REALTORSÒ identified these two replacements as projects that can significantly improve a home’s curb appeal.

“Curb appeal remains king – it’s the first thing potential buyers notice when looking for a home, and it also demonstrates pride of ownership,” said Phipps.

The 2010-11 Remodeling Cost vs. Value Report compares construction costs with resale values for 35 midrange and upscale remodeling projects comprising additions, remodels and replacements in 80 markets across the country. Data are grouped in nine U.S. regions, following the divisions established by the U.S. Census Bureau. This is the 13th consecutive year that the report, which is produced by Remodeling magazine publisher Hanley Wood, LLC, was completed in cooperation with REALTOR® Magazine.

Realtors® provided their insight into local markets and buyer home preferences within those markets. Overall, Realtors® estimated that home owners would recoup an average of 60 percent of their investment in 35 different improvement projects, down from an average of 63.8 percent last year. Remodeling projects, particularly higher cost upscale projects, have been losing resale value in recent years because of weak economic conditions.

According to the report, replacement projects usually outperform remodel and addition projects in resale value because they are among the least expensive and contribute to curb appeal. Various types of siding and window replacement projects were expected to return more than 70 percent of costs. Upscale fiber-cement siding replacement was judged by Realtors® the most cost effective among siding projects, recouping 80 percent of costs. Among the window replacement projects covered, upscale vinyl window replacements were expected to recoup the most, 72.6 percent upon resale. Another exterior project, a wood deck addition, tied with a minor kitchen remodel for the fourth most profitable project recouping an estimated 72.8 percent of costs.

The top interior projects for resale value included an attic bedroom and a basement remodel. Both add living space without extending the footprint of the house. An attic bedroom addition costs more than $51,000 and recoups an estimated 72.2 percent nationally upon resale; a basement remodel costs more than $64,000 and recoups an estimated 70 percent. Improvement projects that are expected to return the least are a midrange home office remodel, recouping an estimated 45.8 percent; a backup power generator, recouping 48.5 percent; and a sunroom addition, recouping 48.6 percent of costs.

Although most regions followed the national trends, the regions that consistently were estimated to return a higher percentage of remodeling costs upon resale were the Pacific region of Alaska, California, Hawaii, Oregon and Washington; the West South Central region of Arkansas, Louisiana, Oklahoma, and Texas; the East South Central region of Alabama, Kentucky, Mississippi and Tennessee; and the South Atlantic region of the District of Columbia, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia and West Virginia.

The regions where Realtors® generally reported the lowest percentage of costs recouped were New England (Connecticut, Massachusetts, Maine, New Hampshire, Rhode Island, and Vermont), East North Central (Illinois, Indiana, Michigan, Ohio and Wisconsin), West North Central (Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota and South Dakota), and Middle Atlantic (New York and Pennsylvania).

“It’s important to remember that the resale value of a particular improvement project depends on several factors,” said Phipps. “Things such as the home’s overall condition, availability and condition of surrounding properties, location and the regional economic climate contribute to an estimated resale value. That’s why it is imperative to work with a REALTORÒ who can provide insight and guidance into local market conditions whether you’re buying, selling or improving a home.”

Results of the report are summarized in the January issue of REALTOR® Magazine. To read the full project descriptions, access national and regional project data, and download a free PDF containing data for any of the 80 cities covered by the report, visit www.costvsvalue.com.

Source: NAR

Home Buying and Selling Tips for Fall

Welcome to the Fall Season everyone! I personally love this time of year with the Holidays, football and crisp air.

HGTV’s real estate site Front Door says the weeks between now and the end-of-the year holidays are the best ones to find a bargain. Here are some of their tips for fall buyers and sellers:

Fall Sellers:
• Replace faded summer plants with fall-blooming flowers and add autumn decorations to the home.
• Expect low-ball offers and be prepared with higher counter offers.
• Freshen up listing photos by shooting pictures that make it less obvious that the seasons have changed.
• Price the home to sell. A price that is a little lower than the competition may be a winning move.
• Be willing to show the property and hold open houses whenever potential buyers are ready.

Fall Buyers:
• Look for motivated sellers who have a reason to move on by the end of the year.
• Explore new constructions. Builders are often particularly interested in selling before the new tax year.
• Beware of fall maintenance issues. Consider overflowing gutters and leaf-covered lawns warning signs.
• Shape offers carefully. Even in this market it is possible to turn sellers off with a too-low bid.

Source: FrontDoor.com (09/16/2010)

4 Tips for Setting the Right Sales Price

Sellers think their homes are worth more than their real estate professional recommends, and buyers think these same homes are worth less.

It’s a difficult disconnect that makes selling properties a challenge. Successfully marketing a home requires that the price be set carefully -- or it will languish on the market. Among the considerations:


1) How many homes are for sale in the neighborhood? The more homes on the market, the more important it is to list at the lower end of the scale. "I want buyers to ask why is this house priced so competitively," said NAR President-elect Ron Phipps of Phipps Realty in Warwick, R.I. "I want the answer to be an offer."

2) Take short sales and foreclosures into consideration when pricing. If the competing properties are in lousy condition, they are less of an issue, but if they are well taken care of, yet priced 25 percent below market, they can be a serious factor.

3) Negotiate decisively. "Buyers are not interested in back-and-forth negotiations these days," Phipps said. "They are less emotional and more disciplined. They will walk away."

4) Cut the price when you have to. If no one shows up for an open house, if no one calls and if there are no offers, then the price is too high. That means it's time to make a meaningful price cut.

Source: The Washington Post, Associated Press (09/18/2010)

Banks Keep an Eye Out for Short-Sales Fraud

Short-sale fraud totals $310 million annually and the average amount of fraud is $41,000 per transaction, according to real estate research firm CoreLogic’s 2010 short-sale research study.

"The best way to mitigate fraud risk and unnecessary loss is through a collaborative effort where lenders collectively share pre-closing and post-closing information,” says Craig Forcardi, senior research director, consumer lending at The Tower Group.

CoreLogic concluded:

The number of short sales in the market has more than tripled since 2008, with the estimated annual volume at 400,000.
Over half (55.8 percent) of all short sales occur in just four states (California, Florida, Texas, and Arizona).
Approximately 4 percent of short sales have a subsequent resale within 18 months.
Investor-driven short sales are not inherently bad. Investors provide the industry with necessary liquidity.
Short sale transactions may be deemed risky to the lender when either the second sale amount is vastly higher than the short sale amount, and/or the two sale transactions are executed within a very short window of time.
Approximately one in every 53 (1.9 percent) short-sale transactions was part of an egregious flip and therefore deemed risky.

Source: CoreLogic (08/10/10)

School/Community Reports from The Cascade Team

With school right around the corner again, we hope you enjoy the new School/Community Reports from The Cascade Team. Simply click one of the pictures in this article and then select "View Reports" to choose your area.

Now you can compare Schools and different Communities and towns side by side just like you do homes in a Market Analysis! Simply click on the Community Reports icon below or go to http://www.thecascadeteam.com/tools.html

Then just enter the zip codes you want to compare, set the default distance (2 to 10 miles) and select Schools or Community info. You can find Student Teacher ratio, compare public and private schools, and more. Works for all 50 States! Under Community info view nearby amenities such as shopping, grocery, arts and entertainment, population and median income!

Feel free to call with any questions: (800) 509-6905

FHA Loans V.S a Conventional Loan

You’ve heard the term FHA but probably don’t really understand how vital this loan is in today’s real estate market. Just what makes FHA so important?


FHA is the single most versatile loan program available and without it, literally hundreds of thousands of potential borrowers would not be able to finance a home.

Compared to all other home loan options, FHA is the second most utilized loan and is, by far, the most flexible in many areas such as credit, down payment, reserves after closing, etc. In many cases FHA is not only a great loan option but it’s the ONLY loan option available.

Take a closer look at FHA’s flexibility- down payment for example; FHA
only requires 3.5% down payment while a conventional loan requires a
minimum of 5% down.

On the surface it doesn’t seem like much but let’s put this in perspective. Given a purchase price of $400,000 FHA would require $6,000 less down than that of a conventional loan (if you’re not quite convinced that is meaningful then just think how long it would take you to save another $6,000).

How about credit scores? This is a big topic these days and rightfully so. If your credit score is 680 (and this is not considered “good” by today’s mortgage standards) and you were applying for a conventional loan with only minimal down payment then your interest rate could be as much as .375% higher than that of a FHA loan. Why? Because conventional loans charge higher rates for lower credit scores. FHA does not. We examined both options with a recent client and the payment on the FHA loan was $57 per month lower. Over 30 years that $57 per month adds up to over $20,000… now that’s real money!

One obstacle that borrowers can be challenged on is the source of their down payment. This can be critical to your loan approval.

A conventional loan requires the borrower to verify that they have at least 5% of their own funds while FHA does not. FHA allows for the entire down payment to be a gift.

A great example of this is a client who just closed on her home. She is a recently divorced mother of two and wanted to buy a home for her and her children. After selling the marital home she had very little equity left over. Fortunately, her parents provided her with a gift for the down payment and she was able to negotiate the seller to pay her closing costs. Because she went through FHA she was able to buy this home with no money of her own. On a conventional loan she would not have been able to purchase a home at this time because she lacked the 5% of her own money. Please don’t misunderstand the intent of this guideline. A financially healthy borrower should have some form of savings but under FHA rules it is not a requirement.


One other advantage of FHA is in regards to mortgage insurance. This is insurance that is required by bank when you’re putting less than 20% down payment.

FHA has their own insurance built into the approval process but this is not the same with a conventional loan. On a conventional loan there is an entirely separate approval process for private mortgage insurance (PMI) and often these guidelines can be more rigid than the bank’s. So keep in mind that just because your bank approves your mortgage doesn’t mean you’ll be able to get that loan if you don’t meet the criteria of the PMI company. Under FHA, one set of guidelines and that’s it.

Regarding private mortgage insurance, a great example of FHA’s flexibility is when you’re purchasing a condominium. If you’re buying a condominium with a credit score under 680 and you are only putting 5% down then you won’t be able to obtain private mortgage insurance. The private mortgage insurance guidelines prohibit this at this time and, therefore, you won’t get the loan regardless of whether your bank approves you! This is not the case with FHA. FHA does not differentiate with separate guidelines. You either qualify for a FHA loan or you don’t. There is no other criterion that has to be met.

The benefits of FHA’s flexibility far outweigh any disadvantages. In recent years there has been some confusion in the real estate market about FHA loans and much apprehension among a few real estate agents who believe that FHA is a harder loan to get approved. They feel that FHA is too rigid with appraisals with respect to the condition of the properties. There was some truth to that statement in that several years ago FHA was more restrictive on appraisals but that has since eased significantly. Today, FHA appraisals are no more restrictive than that of a conventional appraisal.


It’s estimated that there are approximately 14 million potential first time buyers between 25 and 37 years old who are ready to purchase a home. You have to imagine that many of these people will qualify for a conventional loan… but many won’t.

They’ll have circumstances that prevent them from being approved or have financial profiles that make FHA a much better financing alternative. With that said, FHA definitely has its place in this real estate market and is certainly here to stay.

5 Reasons Why Your Home Isn’t Selling

See:http://homesforsaleloganut.com/5-reasons-whyyour-home-isnt-selling/



Home not selling? Do you know why? I bet you have an idea, but you may not be able to grasp it fully. Here are 5 reasons why your hasn’t sold and what you can do about it.

You’re Overpriced

There’s a buyer for every home! Have you heard this saying? Sure, there may be a buyer for your home, but not at that price. If you’ve been on the market for a long time, chances are you’re overpriced.

An overpriced home is the most common reason a home doesn’t sell. When you list your home you’re going to get the most activity within the first 30 days. If you overprice it right off the bat, you likely overpriced buyers that would have qualified for financing at a more reasonable price. And they aren’t coming back.
Sure, you may be able to get a buyer at the inflated price but remember, your home still has to appraise. If your home doesn’t appraise at an inflated price, you will have to reduce the price anyways, or the buyer will likely walk.

If you’re home is overpriced your helping your competition sell their homes. Think about a buyer that looks at your home, then goes to your neighbors home that’s similar, yet priced less. What would you do in those buyer’s shoes? You would put an offer on the home that’s cheaper.

An overpriced home is going to be extremely hard to sell when there’s to much competition. If you can’t reduce your price you can try these other tactics.

Get a FREE on-line Home Value Analysis HERE

Your Home Isn’t Showing Well

In a buyer’s market, you have a lot of competition. If you’re home isn’t showing well, your giving buyers one more reason not to buy it. Buyer’s today are nit picky animals, and they don’t have to settle for a mediocre home anymore.

Let’s face it. A home with a few cosmetic updates can really get buyers excited. If you add some paint, clean the carpets, and bring in some fresh fixtures. Your home will show better. If you’ve been getting bad feedback from your showings, do something about it or your home isn’t going to sell.

Also, household odors can turn buyers off faster then a light switch. Seriously, if your home smells like mold, animal urine, or cigarette smoke, buyer’s will turn around right after walking through the front door. The first thing buyers do when they walk through the door is take a deep breath. If they are turned off by a foul stench, your house loses.

The Cascade Team offers a FREE Home Staging Consultation to all of our clients. Learn more HERE

You’re In A Bad Location

The most important factor for a home selling, besides price, is location. Location is one thing you can’t change, unfortunately. If your home was in a better location, it may sell for up to $100,000 more then what you can get out of it in a bad location.

What’s considered a bad location? It depends on the buyers. Some buyers have young children they want to attend certain schools. If your school district is undesirable it may be considered a bad location.

Maybe you live close to a loud highway or the neighborhood is declining in value due to foreclosures. It could also be a smelly neighborhood with farms or industrial buildings nearby.

How do you deal with a bad location? One of the best remedies for a bad location is a reduced price. If you can’t reduce your price, you may need to offer something different from your competition such as seller financing, or add in some furniture to the asking price.

You Have A Terrible Listing Agent



Did your agent promise you the moon only to give you a piece of moldy cheese? Some agents will tell you your home is worth more then it truly is using a technique called “buying a listing,” which is an unethical practice. They will tell you they can sell your home for more then other agents just to get you to list with them. They know very well that they can’t sell your home for that price.

The strategy here is to get more signs in order to get more sign calls from buyers. And agents that buy listings will hound you to reduce your price after it doesn’t sell.

All real estate agents are not created equally. It’s way to easy to get a real estate license and some agents just aren’t good enough to make it in this business.
You might have a bad agent if all they did was put a sign in your yard and put the home on the MLS. You may have a bad agent if you never get any feedback from your showings. Bad agents don’t return phone calls or emails in a timely manner. Bad agents may be arrogant or abrasive which leads to other agents not wanting to work with them.

If you realize the problem might be the agent, you may just have to wait out your contract. Ask the agent their policy, as most agents will release your from the contract at anytime. A good agent wouldn’t work with someone that isn’t satisfied with their services, they would fix the problem, or they would let you move on.

See The Cascade Team's Professional Brokers HERE

You Have Insufficient Marketing

This goes back to having a bad agent. No longer can we just put a sign in your yard and call it good. The listing process has changed drastically over the last couple of years.

There are thousands upon thousands of real estate websites out there, and over 90% of home buyers start their search online. If your listing agent doesn’t have a robust online marketing strategy, your marketing could be lacking.

Have you heard the saying, “print media is dead”? Well, in real estate, this is just not true. Many people still look at the newspaper for open houses and your local real estate book still gets descent circulation. Yes, most buyers are online, but you have to be everywhere. The buyer that hasn’t yet moved over to the online world can still buy your home.

Today’s top performing agents have a multi-level marketing strategy. They will utilize all the tools available: sign in your yard, color flyers on the sign, websites on the sign riders, multiple phone numbers, MLS listing, directional signs on corners of busy streets, newspaper adds, multiple open houses, and it goes on and on.

When hiring an agent, it’s important for you to ask questions about their marketing strategy, and check up on them. If they say their going to do something, you need to check to make sure it’s getting done.

If you’re home isn’t selling, I truly am sorry to hear it, and there are many many people out there with the same problem. Today’s market is a whole new animal. It takes an aggressive strategy and time to get any home sold.
Give buyers a good reason to buy your home. They know the market is saturated with inventory, and their looking for the best deal. Selling your home today means making it the best deal in your price range.

The Cascade Team Real Estate has the most comprehensive marketing program availiable. Learn more HERE

Biggest Real Estate Risk: Falling Prices Or Interest Rates Increasing?

http://homesforsaleloganut.com/real-estate-risk-prices-falling-or-interest-rates-increasing/


In the early 2000′s, real estate wasn’t risky; it was an investment with guaranteed returns, and large returns at that. People were buying homes and just five years later selling for double what they paid. It was a ludicrous business, and everyone was hopped up on the real estate bubble.

Today real estate is a more risky business, in the short term anyways. Long term, real estate is still a great way to invest money. One thing people are worried about the most is where is the bottom of the market? Is it here?
Are we going to see a double dip and watch real estate prices continue to plummet? Possibly, but lower prices isn’t your biggest risk if you plan on buying real estate.

Your Biggest Risk In Buying Real Estate Is Higher Interest Rates.

Interest rates, again, hit all time lows this week. To be honest, these rates are a little ridiculous. You could buy a home today and pay it off in 15 years when it would have taken you 20 years to pay it off with the same payment just 3 years ago. Let me show you what I mean for those of you who are visual people. (30 year mortgage)

Today’s Interest Rates
Monthly Payment = $1,053 Interest Rate = 4.13% Buying Power = $240,000

Interest Rates 3 Years Ago
Monthly Payment = $1,053 Interest Rate = 6.83% Buying Power = $177,900

Do you see what I see? These numbers are incredible. I remember when people were happy to pay interest rates below 7%. I was happy to pay 7% on my loan for the home I own. I thought I was getting a great deal, and I was. But looking at interest rates today, I’m amazed.

As you can see, if you bought a home today, and prices dropped another 20-30 grand, you would still be way ahead. Because, as you know, with interest rates so low and the fed printing money like their getting ready to party like it’s 1999, inflation is looming.

Inflation means higher interest rates. Can you imagine where interest rates are going to be in 3-5 years from now? Are you waiting to buy in 5 years when the market returns? Why? When interest rates go up, you won’t be able to buy what you can now. Your biggest risk isn’t prices going lower, but interest rates going higher.

Assessed Home Values Are Not The Same As Fair Market Value

One of the biggest myths in Real Estate is a homes assessed value having a correlation to it’s present market value.

Unfortunately it is easy to see why the general public is often times confused about this because a number of Real Estate agents fail to educate their clients that there is a big difference. Trust me looking at assessed values is no better than using Zillow.com to figure out what a home is worth!

When the assessed value from the town is higher than what a property is on the market for you will often see Agents writing advertising that says something like the following “Come see this bargain home that is priced $75,000 less than the assessed value”. What this immediately tells me is the Agent either does not know anything about property valuation or they think there will be someone foolish enough to believe the home really is a steal. Someone that knows better is going to be thinking the property has been over assessed by the town and the seller has been paying too much taxes!

Of course on the other side of the coin you will see home buyers who see a home listed higher than the assessed value and if they have not been educated properly by their buyers agent, will improperly use this as part of their negotiations when making an offer. If more people were better informed they would know that assessed values are a worthless piece of information when evaluating what a property is worth.

Most people realize that market values of homes in many parts of the Seattle area have dropped quite a bit over the last five years. As values were dropping there were many that believed their taxes would also be coming down too. When people misconstrue that assessed values and fair market values are the same they will automatically come to this conclusion.

In theory this should be the case but assessed values are nothing more than a yard stick for a municipality to collect an appropriate amount of taxes to sufficiently cover the state and local appropriations chargeable to the city or town.



The assessed value of a property often lags the market because the valuations are not re-calculated until the beginning of the next calender year. So if the market values of homes are dropping it is not unusual to see the assessed value being higher. Likewise if values are going up it could be just the opposite.

Over the years I have seen some of the strangest things when it comes to assessed home values. Believe it or not I have seen some homes that are as much as a couple hundred thousand over or under assessed in comparison to their sales price.
I have seen two homes built by the same builder side by side where home “A” was larger and had a bigger lot than home “B” yet home “B” was charged more in taxes due to a higher assessed value. Kind of mind boggling don’t you think?

What I have also observed is that a home that has re-sold more recently will usually have a more accurate correlation of its market value compared to its assessed value than a home that has not sold in a long time. For example, a home that sold three years ago more times than not would seem to have a more accurate correlation than a home that has not sold in ten years.

Yet another example is the home owner who feels they are being over assessed by the town and decides to challenge and wins an abatement. Their assessed value is now reset to the lower value. Does every other home owner who has a similar property get a notice in the mail saying their homes assessed value will also be coming down courtesy of the research done by Mr. Jones next door. Fat chance amigos!! This is the case of the squeaky wheel getting the grease.

So what are you supposed do if you think your assessed value is out of line with other like homes in your neighborhood or town?

You should head to your local Assessor’s office and file for a tax abatement! All the information necessary regarding the application process and the deadlines for filing should be made available to you.

Applications for abatement’s are due on or before the due date for payment of the first actual bill. The town’s assessor typically has up to three months in to act upon an abatement request.

If you are denied your abatement request and do not feel that the assessor made the proper ruling you have the right to appeal to the State Appellate Tax Board.

In summary an assessed value is the valuation placed on a property by a public tax assessor for purposes of taxation. Fair Market Value on the other hand is the agreed upon price between a willing and informed buyer and seller under usual and ordinary circumstances. It is the highest price which the property will bring when exposed for sale on the open market to a buyer who is purchasing with full knowledge of the properties highest and best use.


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The Worst Home Improvement Returns on Investment

We often talk about the top 10 best home improvements, or where is the best place to spend your money to make your home stand out. Working on the "Flip-Side" of that; here are the worst home improvement returns on investment.

Many people blindly assume that every improvement they make to their home will bring an automatic 100% return or close to it. Unfortunately this is not the case…far from it. One of the best home improvements you can make to your home is a remodeled kitchen and that generally only brings a 75% return!

I don’t know how many times over the years that I have done an evaluation on a sellers home and they were disappointed to find out the value was not quite what they expected. More often than not it can be traced to the fact that money was put into the home in places where there is a very low return.

So what are some of the worst returning investments in a home?

Swimming pools

Let me 1st preface by saying that this by saying that adding a swimming pool somewhere other than Seattle may add more value in a home. In Seattle the time you are able to truly enjoy the use of a swimming pool is around three months. The weather in the northwestern states in not the same as down south or out west in the Arizona area where temperatures remain much warmer for a larger part of the year.

Swimming pools are generally far more expensive to install in Seattle because of our rocky soils. The cost of an in-ground swimming pool can vary quite a bit depending on the size and whether it is a gunite or liner pool. On the lower end you very basic liner pool is going to cost around $40,000 by the time your figure the cost of the pool, fencing, landscaping, etc. A luxury swimming pool can easily go upwards of $100,000 if you go all out with a nice design and frills such as a cabana, fireplace and fancy surfaces around the pool.

When you install a swimming pool in the Seattle area what you really should be thinking about is the enjoyment you are going to get out of having it. Do not expect that you will be getting a good return on your investment. Swimming pools often times can actually end up being a detriment when selling a home. There are many buyers that flat out will not buy a home that has one no matter how beautiful it is.

Are there times where a buyer is specifically looking for a pool? Sure…if you are lucky you may find a buyer that will pay a little more for a home with a pool. Just don’t expect that it will be anywhere close to the money you have sunk into the ground.

A new septic system

While you would never hear a couple saying “hey honey what do you think about getting ourselves a beautiful new septic system?”, the fact of the matter is that many home owners incorrectly assume that a buyer will give you something because you have one. Fat chance!

Replacing a septic system is really one of the worst nightmares a home owner can face. The cost involved with installing a new title V system can put a huge dent in your wallet. The cost of replacing a septic system can vary quite a bit depending on the soils and the ground water level. If there are tough soil conditions and a high water table you could be shelling out $40,000 – $50,000 or more to have a new system installed.

Even if the soil conditions and water table are very favorable you could still expect to be handed a bill of around $10,000. There is no question that replacing a septic system is a huge investment. Replacing a septic system is obviously not something you run out and do because you just feel like it. If your system fails it is a fact of life that it must be replaced.

The problem is a buyer could care less if you have a new system in the ground. All a buyer is going to care about is when the toilet flushes it works. Do not expect a buyer to pay for your septic problem! You will be lucky if you get the buyer to pay 10%-20% of the cost of installing a new system.

A new roof

There is no question that one of the major components a buyer cares about when purchasing a home is the roof and basement. Of course this stems from the fact buyers never want to think about having a water issue. Surprisingly though home buyers do not care if you have a beautiful new architectural shingle adorning your rooftop.

As an example lets take two identical homes in the same neighborhood one with a twenty year old roof approaching the end of it’s useful life and another home with a new roof. Let’s also assume the new roof would cost the seller $12,000 to replace. Don’t expect the buyer to pay an additional $12,000 for the home. Buyer’s rarely ever pay for the mundane. Buyer’s are far more willing to pay extra for things they can enjoy on a daily basis. A new roof is not one of them. A gorgeous new bath….different story!

There is no questions that a swimming pool, septic system and roof are three of the worst home improvement for return on investment in a home. What are some of the others? According to the latest cost v.s value remodeling report for the Northwest here are a few more home improvements that do not fair well when it comes time to sell:

A bathroom addition which comes in at a return of 59.5%
A home office remodel which returns 48.1% on investment.
A master suite addition which comes in at 65.2%
A deck addition also has a low return at 60.8%