Don’t Renovate and Sell!

home renovationsHomeowners often consider making renovations before selling. They believe the increased value of their home will exceed the cost of renovation. Unfortunately, this is often not the case. For every dollar you spend on renovations, you generally recoup less than a dollar back.  See the annual report in Remodeling magazine, which compiles statistics on the cost recouped of most remodeling projects.

Based on surveys of thousands of real estate professionals, Remodeling magazine concludes that the highest return projects are around 70%, while the lowest are in the neighborhood of 40%. The magazine sends out surveys to thousands of real estate professionals across the country essentially asking for their experience and opinions. The conclusions can’t be scientifically proven, but as the costs of construction are fairly easy to determine there is no reason to doubt the survey’s construction figures. However, I wouldn’t rely too heavily on the specifics of cost recoupment figures. I have seen the surveys they send out and there is simply no way to compile figures in any truly scientific way. Who really knows how much a particular home would have sold for if the kitchen hadn’t been renovated?? Rather, the opinions of thousands of real estate agents, appraisers and other real estate professionals are probably fairly accurate in a general sense. They should be used as a general guide as to which projects result in higher or lower cost recoupment, and very approximately what to expect.

Interestingly, according to the study, renovated kitchens and baths recoup somewhere around 55-65% versus other projects that return more. Common real estate wisdom says that kitchens and bathrooms sell homes. So what’s going on? The answer to this conundrum is that nice kitchens and baths make homes appeal to more people and easier to sell, but are just not valuable enough to recoup the initial investment.

The value proposition of renovating your kitchen and baths looks much better when you do the renovations a few years before you sell your home. You also get the chance to actually enjoy the renovations. Most real estate agents consider kitchens and baths fairly new up to around 3 years after renovation. For example, you spend $50,000 on a new kitchen and enjoy it for 3 years. You then recoup 65% of the cost at sale, so the renovations cost you about $17,500 and help sell your home.

In real life, it may be difficult to plan ahead. However, if you are considering making improvements to your home, considering recoupment values may help you determine what renovations make the most sense in the long term. After making improvements, I often hear sellers say, “Wow, I should have done this earlier.”

{Please Comment Here}

What is ENERGY STAR?

Energy-StarENERGY STAR is a joint program of the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Energy designed to help consumers save money, and protect the environment through energy-efficient products and practices.

In 1992, the (EPA) introduced ENERGY STAR as a voluntary labeling program designed to identify and promote energy-efficient products to reduce greenhouse gas emissions. Computers and monitors were the first labeled products. By 1995, the EPA had expanded the label to residential heating and cooling equipment. The ENERGY STAR label is now on major appliances, lighting, home electronics, and has been expanded to cover new homes and commercial and industrial buildings.

Whole Home ENERGY STAR Rating

For an entire home to be labeled ENERGY STAR, it must be built by an ENERGY STAR builder-partner to meet strict guidelines for energy efficiency set by the U.S. Environmental Protection Agency. These homes are at least 15% more energy efficient than homes built to the 2004 International Residential Code (IRC), and include additional energy-saving features that typically make them 20–30% more efficient than standard homes.

The ENERGY STAR label is rapidly becoming more of a selling feature. Home buyers are now very conscious of a potential home’s energy efficiency. The Multiple Listing Service has specific sections where ENERGY STAR rated systems and appliances can be highlighted so that buyers can easily determine if there is ENERGY STAR rated equipment in the home they are considering. However, as the whole-house Energy Star rating is fairly new, it doesn’t yet appear often.  As more and more homes get the designation, you will see it more often and consumers will look for the whole home rating.

The ‘No Cost Energy Assessment’ & Benefits

Locally, the ENERGY STAR program is partnered with a program called Mass Save. This initiative is sponsored by several local energy companies and administered by a company called Conservation Services Group. Through Mass Save you can schedule a no-cost “Energy Assessment” on your home or even your rental property. Depending on the results, homeowners are then eligible for an instant rebate of up to $2,000 for 75% of the cost of installing insulation, and a zero percent interest loan on new heating equipment. The website also contains a wealth of information on saving energy as well as information like current tax credits available for energy efficient home improvements.

As energy costs continue to rise, taking advantage of the Mass Save program, and looking for ENERGY STAR rated appliances will not only benefit you in the short term, but add value to your home when it comes time to sell.

Resources:  www.masssave.com, www.energystar.gov

{Please Comment Here}

Is Your Painter Lead-Paint Certified?

Lead Paint RegulationsOn April 22, 2010 Massachusetts adopted a lead paint law that  likely affects you if you own a house built before 1978. Previously, you could hire anyone,  to paint anything  in your house. Not anymore.  The “Renovating, Repair and Painting Rule” (RRP) requires that for home improvement projects that will “disturb” more than 6 interior square feet of paint or 20 exterior square feet of paint, your painter must be certified by the EPA.  The only exceptions* to this rule are if:

  1. Your house was built after 1978
  2. The house or “components” of the house have been tested as lead free by a Certified Risk Assessor, Lead Inspector, or Certified Renovator
  3. You do the renovations yourself.

Fortunately, professional painters can become certified relatively easily by taking a one day course and paying a fee of $375. Painters who are not certified face fines of up to $5,000, license suspension and can be subject to a “cease work” order by any number of public health agencies, including  possibly, the local building inspector. The “cease work” order/penalty is the major risk to a homeowner. There is no provision in the law for any other type of penalty against a homeowner.

Initially, a Boston Globe article reported that there were concerns that the certification requirement would make hiring a painter more expensive.  However, almost 2 years after the law went into effect, I couldn’t find any evidence of increases in the cost of hiring a painter. Although the time and expense of obtaining certification are relatively minor, there are real expenses associated with properly managing work sites that contain lead dust. Costs will likely rise, but worksites should be safer and ultimately homes will be safer as well.

If you decide to undertake a do-it-yourself renovation or painting project where there is any possibility of creating dust and you might have lead paint, I highly recommend you  learn how to properly handle and contain the dust from your project. Most of it is common sense and merely requires a high level of preparation and care. A good resource is the Renovate Right pamphlet that lead-certified contractors are required to provide to consumers.

The laws around lead paint are extensive here in Massachusetts. If you have information or expertise you would like to share, please comment, or contact me.

Other helpful resources are:

*The question arises that if you hire a general contractor who is lead-paint certified, and he sub-contracts out the painting work, do those painters have to be certified? The answer is complicated. There are rules about who has to be certified on a job site, and when a “non-certified” painter can be on the job under the supervision of someone who is certified. As a general rule, if you are hiring a general contractor make sure he really understands the lead laws and fully intends to follow them.

{Please Comment Here}

A Tale of Three Roofs

In the course of a day or a week, how many houses do you think you pass and observe? Homes can be unique in their style and architecture, but roofs generally fall into one of three broad categories: gabled, hipped and flat.

The type of house usually referred to as “Gambrel” or “Dutch Colonial,” is a prime example of a house with a gabled roof. The gabled roof is characterized by two or more sloping planes supported at each end by triangular wall extensions, known as gables, which occur at varying angles. The actual “gable” is the part of the wall between the sloping roof lines.

Side Gable Roof
Cross Gabled Roof
Front Gable Roof

 

The key to recognizing a hipped roof is that all the roof surfaces slope downward to the walls.  It usually results in the roof having a pyramid-like appearance.


A hip roof on a rectangular plan

A square hip roof (also known as
a “pyramid roof”)

Flat roof with parapet walls

 

The last major type of roof is the flat roof.  This roof is fairly self-explanatory and is evident in so many of the triple deckers found locally. Flat roofs are normally built with parapet walls or eaves. A parapet wall is a continuation of the side walls, or a separate structure around the perimeter of the roof that rises higher than the roof.

Italianate eave with brackets

Eaves are simply that part of the roof that over hang the supporting walls:

Although there are many variations and combinations of these three roofs, if you look closely at any building, you can easily deduce the basic roof type from which it originates.

{Please Comment Here}

Inspirational Design Meets the Accessibility Challenge

This week features my friend, guest blogger and fellow Rotarian,  Karl Damitz, Principal Architect and owner of FourFold Design.

Over the past 10 years of my professional practice working as an architect in and around Boston, some of my most challenging and rewarding projects have involved clients with physical disabilities. The integration of thoughtful design solutions that address the specific needs of a client with limited mobility can have a profound impact on his or her life.

The Americans with Disabilities Act has proven to be an important step in creating more equality for people with disabilities. The act mandates that all public buildings be designed for ease of use by persons with many kinds of disabilities. However, it has also created a stigma around accessible design. The design quality of many, if not most, public accessibility projects is very poor. When considering accessibility for a private residence, the design challenges are completely unique, with little relationship to the ADA guidelines that have been laid out for public work.

In residential design, the challenges of designing a space that meets these far more specific set of challenges and conditions very often means that traditional solutions and guidelines are ineffective. Products and standards that are marketed for accessibility uses are typically more clinical in nature and reflect a ‘hospital surplus’ aesthetic that has little relevance in the realm of residential design. For the residential market, a sterile and clinical renovation that simply addresses accessibility from a functional perspective could result in a reduction of property value and turn off potential buyers, ultimately limiting the pool of potential buyers.

The key to a successful residential design project that accommodates and supports a homeowners’ physical needs, while maintaining or increasing market value, is the integration of specific, design-focused solutions that emphasize the owners’ personality and style, rather than emphasizing their disability. A purely functional and prescriptive approach often results in a space that fails to engage the homeowner and, instead, becomes a constant reminder of their physical limitations. The true value of great design work—the key to a successful, accessible residential project—is to deliver a product that addresses the practical needs of the homeowner, without revealing or highlighting this need to the casual visitor.

This shower is barrier-free (no curb) and has a removable shower head whose anchor can double as a grab bar.

Achieving truly exceptional design in this arena requires a process that considers every component for its practical and aesthetic value. A ramp should no longer be viewed as a functional element that connects two different levels, but as part of the experience of moving through the house. It should fit comfortably and flow naturally.

In the end, the best design solutions for an accessible home must meet the functional design requirements of the project.  The most successful project is one that seamlessly integrates design solutions and emphasizes the identity and style of the homeowner far more than the disability that it has been designed to accommodate.

Learn more about FourFold Design.

{Please Comment Here}

Feng Shui – One Agent’s Perspective

A few weeks ago I was walking along Osborne Street near my home in Brookline. I looked up and noticed this large house facing me from the end of Osborne Street.

While the house itself looks great, I particularly noticed how amazing it felt to look down Osborne and see this magnificent house sitting handsomely at the end. It occurred to me that having one’s entrance looking down the street would be considered excellent Feng Shui. I remembered that the developers of the Mandarin Hotel and Residences in the Back Bay had, at great expense and at the last minute, situated the Hotel entrance to look down Fairfield Street in order to improve its Feng Shui.  They even had to move the street lights to make it all work. See this Boston.com article to read the full story.

Feng Shui, literally translated as “wind-water” is an ancient Chinese system of aesthetics  that uses various principles of energy, design, architecture, and other disciplines that work together to improve life. In the context of residential real estate, it is mostly an art related to improving design and function. It is not really about aesthetics (although aesthetics still play a role), but rather about energy and balance so that one’s life works better. In my experience selling homes, I have had clients with varying degrees of concern for and knowledge about how a potential home measures up according to Feng Shui principles. I have also had a couple of clients hire Feng Shui consultants to evaluate their potential home, and I hired one myself to suggest improvements to my last home. I have learned a few things in this process. These are NOT in any way any kind of basic principles but rather just some interesting odds and ends I have picked up.

  1. Real estate agents are generally not that happy when their clients want to evaluate a home’s Feng Shui. They often see it as just another obstacle that may have to be overcome. Fortunately, this is not my perspective.
  2. Rectangular construction is good.  Corners are good. Anything curvy can be problematic. The reasons for this are somewhat complicated and are related to energy and balance.
  3. When you are considering a condo or apartment on more than one floor you should be concerned if your upper floor is not situated entirely over your lower floor. A floor plan that falls into this category is known as the “Philly Duplex.”  These homes occupy half of one floor and then all of an adjacent floor.  The reason for this concern relates again to balance and also to healthy boundaries between your home and your neighbor’s.
  4. Bed placement is crucial. Make sure you place the bed so that you can see the entrance to the bedroom from the bed, but it is not directly in front of you. I did not adhere to this principle at one point and my bedroom always felt wrong – now I know why.
  5. Many, if not most, “problems” can be mitigated enough to alleviate major concerns without reconstruction or spending a great deal of money. You can vastly improve the Feng Shui of your home working with the right colors, proper furniture placement, plants, screens and mirrors, as well as just de-cluttering. There is also a huge amount of information out there and it is fairly easy to find and understand.

Do you have any good Feng Shui stories or principles you would like to share?
{Please Comment Here}

Please Don’t Make These Mistakes…

Someday, somewhere, you will probably have to do some work in your home.  If you remember just a few brief words of advice, your home will be just that much nicer for both you and anyone else who may ever live there.

Early in my real estate career, a very wise and experienced real estate professional told me that when you are doing a renovation you ought to spend as much as you can on the parts of the house you physically interact with the most. He was referring to the things you actually touch like door handles, faucets and railings. However, much to my chagrin, many builders seem to subscribe to the opposite philosophy – put in the cheapest and ugliest fixtures you can find.

My number one pet peeve here is the Symmons brand ‘shower exchanger’. This is the device that diverts the water in your tub/shower combination to either the tub or the shower. I am sure you have seen it a thousand times. If you own one, please don’t be offended. I am the proud owner of several of these in my rental properties, although I didn’t install them.

Click image for product details

It is actually fairly solid and reliable. If you are renovating a rental property and you really don’t want to have to worry about having to replace it for a long time, it might not be a crime to put it in. At about $112 for the whole set (valve and trim kit) it is inexpensive. It is also, in my humble opinion, just plain ugly. For only a little bit more (about $130 – $150) you can get a high quality Kohler fixture that looks pretty good, for example:

Click image for product details

and

Click image for product details

You can find these and others at http://www.faucetdirect.com/shower-valve-trim/c241

If you are only shopping for the shower valve, you can do even better for about the same money because you won’t need a tub spout and an exchanger. This leads to my next subject – the walk-in shower versus the shower/tub combination.  I am sure my opinion on this will lead to lots of controversy and contentiousness.  You will, however, have to check back in two weeks to see what all the fuss is about.

{Please Comment Here}