Renovations in Houston: Can You Over-improve Your House?

Alright, let’s talk about something near and dear to every homeowner’s heart: renovations! We all dream of that perfect kitchen, the spa-like bathroom, or the backyard oasis. But here’s the thing, folks: sometimes, too much of a good thing is, well, too much. Let’s dive into why you need to be careful not to over-improve your house.

Imagine this: you’ve got a perfectly nice three-bedroom, two-bath ranch-style home in a cozy neighborhood. You decide it needs a facelift, so you go all-out. We’re talking top-of-the-line Italian appliances, marble countertops, a standby generator, and a backyard infinity pool. Sounds amazing, right? Absolutely! But here’s the kicker: your neighbors? They’ve got standard upgrades, maybe a new deck or some modest quartz counters.

Renovations Don’t Always Pay Off in Houston

Now, when it’s time to sell, you’re looking at a serious problem. You’ve poured a ton of money into your home, but the market value of your property is largely determined by the surrounding properties. An appraiser is going to compare your property to everything around it, and the value of your home will be similar to the rest of the homes in your neighborhood, regardless of how much money you’ve put into it.

Think of it this way: you wouldn’t wear a tuxedo to a casual backyard BBQ, right? It’s all about context. Your home’s value is tied to the “context” of your neighborhood. So, if your neighbors have granite, and you install diamond-encrusted countertops, you might not see the return on your investment you were hoping for.  It’s important to realize that most improvements have zero ROI, and for the ones that do, the ROI is only about 25 cents on the dollar.

Home Renovations Are a Sunk Cost in Houston Real Estate

Another thing to consider is your personal enjoyment versus resale value. Sure, that custom bowling alley in the basement might be your dream, but will a future buyer appreciate it? Or will they see it as a costly and unnecessary feature they’d have to remove? The infinity pool with rock water feature is a much needed respite in the Houston heat, but will future buyers see it as one more thing they have to clean on the weekends? 

Here’s a simple rule of thumb: aim for improvements that align with the overall value and style of your neighborhood. Focus on updates that appeal to a wide range of buyers, like a fresh coat of paint, updated fixtures, or energy-efficient appliances. These kinds of upgrades generally offer a better return on investment.

Don’t get me wrong, it’s your house, and you should make it a place you love! But before you embark on a major renovation, take a step back and consider the bigger picture. Talk to a local real estate agent, research comparable properties, and think about your long-term goals. A little planning can save you a lot of money and heartache down the road. Remember, it can be a costly mistake to over-improve your house.

Got renovation plans and want to know if they’ll increase or decrease your property value? Consult with an expert! Contact your friendly neighborhood Houston real estate expert today at Angel Fultz Realty. I’ll give you my best recommendation on whether your renovations will make your Houston house harder or easier to sell. Either way, I can help you sell it fast!