Upgrades and renovations
What upgrades are worthwhile?
Spend money on bathrooms and the kitchen. Even then, don't go
crazy. An upgraded wood floor may pay for itself when it is time to
sell but perhaps not.
Actually, nice furniture and fluffy matching towels and getting rid of
all the clutter will help you sell
your unit faster and for a better price than a lot of upgrades that
stay with the unit.
Who are the
A lot of potential buyers are investors who want to rent the unit that
they are buying and have no plans to live in it themselves. The cheaper
the basic unit, as long as it is in good shape, the better as far as
they are concerned.
It would be different if you live in a condo that attracts
owner-residents. Since they will be living in the unit, upgrades should
make the unit sell quicker if not for more money. As the old saying
goes; time is money.
There is a two-bedroom unit that is for sale in the condo where I live.
(January 2015) The asking price is $470,000. Similar sized units in
this building have sold in the range of $290,000 to $320,000.
It does not matter if the owners renovated the walls with solid teak
wood and pure ivory columns, the toilets are made of gold and
Michelangelo painted the ceiling himself—this unit is not going to sell
for anywhere near what they are asking. Impossible.
for this ceiling, we will pay an extra $10,000. Tops!
They are asking $150,000 to 160,000 more than what the highest priced
comparable units in this building sold for—a 50% premium.
When we bought my present condo, we found a unit in the building where
we wanted to live that had been languishing on the market for over a
half a year. There had been three price reductions and it was still
unsold. We arranged an appointment and give it a good look.
The previous owner spent a lot of money on renovations. She claimed to
have spent $40,000 on the kitchen alone.
She may have, but although the kitchen was nice, it was definitely not
what my wife and I would have done so we added some money to our first
offer but only about half as much as she wanted.
The rest of the apartment was definitely not too our taste and we knew
every room needed repainting, all the new light switches, receptacles
and door handles had to go and the engineered wood floors had to be
replaced. The bathrooms were ghastly. They had to be completely ripped
out and replaced.
Also there was no way we were going to pay an extra $10,000 for a used
European electric stove and matching fume hood.
We came to a deal with our second and final offer. They took their
European stove, the fume hood and the light fixtures with them and
I bought new replacements, that we believe are superior to her aging
appliances, for a fraction of the price.
Now we are having a go at renovating the apartment. We are gutting both
bathrooms and replacing the hallway tiles with a style that we like.
The cheap pantry is being replaced with a custom built one and the
walk-in closet has been completely redone.
Will we get our money out these renovations?
For sure we will get most of the money we are spending on the bathrooms
back and maybe something for the new pantry but not the money we are
spending on the new
hallway tiles or the walk-in closet. That money is being spent to
satisfy us as we plan to keep our unit, hopefully until we die.
Flooding—a constant peril
Having unit insurance is a must. The more upgrades you have, the more critical having adequate unit insurance becomes.
This is because condo units can (will) be flooded from the units above,
the common element plumbing pipes and from the building exterior. If
you are on one of the top floors, then add roof leaks to this list.
Having a unit underneath a condo's swimming pool or hot tub is begging
The condo's insurance will pay for the damages, if they exceed the
insurance deductible, but only to put the unit back to the "standard
unit" specifications that are listed in the condo's by-laws. You need
insurance to pay most of that deductible and to pay for any and all
upgrades that you paid for when you bought the units and for everything
you later added.
David Fleming wrote an excellent article on condo upgrades and features that do not
result in increased selling prices. Well worth reading.
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