Be honest… is your home in need of some repairs? Because the truthful answer to that question may make the difference between selling a property or being stuck with it… even in this strong seller’s market.
Appraisers, Realtors and home inspectors sometimes use the term “deferred maintenance,” which Wikipedia defines as: “the practice of postponing maintenance activities such as repairs on… real property… in order to save costs, meet budget funding levels, or realign available budget monies.”
I love it that definition. It’s so gracious! Let’s break it down…
Referring to deferred maintenance as a “practice” makes procrastination sound like an esteemed vocation, like the way neurosurgeons “practice” medicine and attorneys “practice” law.
And that last line, the one about saving costs, meeting budget funds and realigning monies? It makes the unwillingness to invest in one’s most valuable asset sound strategic, like a Chief Financial Officer successfully managing funds for a Fortune 500 company.
But the reality is that “deferred maintenance” is the polar opposite of “preventative maintenance.” The “practice” of postponing home maintenance and repairs in order to save time, money and effort today can cost homeowners big time in the future.
In my experience, today’s cash buyers strongly prefer a turnkey home to a fixer-upper.
And buyers who finance will rely on the home being appraised at or above sales price, which may not happen if too much deferred maintenance has been “practiced.”
Heck, even if you don’t plan to sell your home in the near future, appraisals are required in order to refinance existing mortgage loans.
Appraisers, Realtors and buyers will notice, before even getting out of the car, if your driveway has so many cracks and potholes that it looks like a satellite map of the Lakes Region. They’ll take note that the front lawn is choked with weeds and dead bushes. They’ll spot things like the unrepaired crack in the kitchen window, torn, stained carpeting in the living room, and the chipped paint on the hallway walls in between.
These and other signs of deferred maintenance mean the difference between sold and stuck.
In order to sell your home you must think like a buyer. Buyers instinctively tend to overestimate how much it will cost to fix the problems noted during the buying, appraisal and home inspection process. And evident neglect inevitably makes buyers anxious about the possibility of other problems that they can’t see. Is it merely the tip of the iceberg?
Buyers will consider the time and hassle of getting the work done, and they’ll worry about finding the cash or credit to pay for it immediately subsequent to parting with a hefty down payment and closing costs. This is especially true in today’s market, in which buyers are buffeted by inflation, rising home prices and rising interest rates.
Think of it like this… would you rather spend the night at the Bates Motel or the Courtyard by Marriott? Be honest… even if you had a Groupon discount for the Bates Motel (and Norman Bates was away on vacation with his mother), would you rather stay there, or spend a little more to stay at the sparkling Marriott just down the road?
This example considers spending a small amount to reside in a place for a short time. Home buyers, on the other hand, are going to spend hundreds of thousands of dollars or more to reside in a place for a long time.
Today’s savvy buyers do not want to pay for the privilege of inheriting the present homeowner’s problems. Conversely, pride of ownership is what will get you the biggest reward in the long run.
Home maintenance is an integral part of homeownership. Sellers who invest a little in preventative maintenance along the way build more home equity than those who don’t. Sellers with well-maintained homes usually don’t have to face large deferred maintenance penalties when they sell.
So if your home is trending more toward the Bates Motel than the clean, well-maintained Courtyard by Marriott, start proactively tackling any defects that might impede the sale or refinancing of your home.
You can’t change your home’s location, or help it if your home is the smallest on the block. But you can make a list and make it a “practice” to proactively address deferred repairs to your home and its systems, which will preserve or boost your home’s appraised value and make it much easier to sell when the time is right.
Brent Metzger is a Realtor® with Roche Realty Group in Meredith. If you’re curious how much your home might be worth in this peak value market, he can be reached at (603) 229-8322 or email@example.com. To learn more about the Lakes Region real estate market visit www.RocheRealty.com.