If you live in Detroit, the surrounding suburbs, or just about anywhere else in the U.S. you are aware that the housing market is in pieces. House values have fallen tremendously, foreclosed homes sit vacant everywhere, and some houses have been on the market for months, perhaps years. What can you do to increase your homes value and appeal?
Right now the economy is slow, house prices have fallen dramatically, buyers aren’t buying, and workers are out of work. What does this mean in terms of home improvement?
Home improvement is one aspect that many people aren’t willing to overlook even when the economy is bad and money is tight. Why? Money invested in a home almost always has a return on investment. Typical returns of around 80 cents on the dollar are commonly expected. This means that for every dollar you spend on home improvement, you will get 80 cents back when you sell your home.
However, during times like now with a slow economy, falling prices, and builders out of work, your actual return on investment could be over one dollar for every dollar invested. How could this be possible?
Right now many builders and contractors are out of work. There is little work due to few new homes being built. These out of work builders and contractors are willing to work for significantly lower prices than usual simply to find work. Many will work for as little as half the pay they worked for 5 years ago. This benefits the homeowner significantly.
Second, many supplies and materials for home improvement have dropped in price. Market demand determines the price of goods such as wood, drywall, and other building supplies. With a lack of demand, the prices have been falling to meet supply and demand guidelines.
Third, house values have fallen to near record lows. Your house which may have been valued at $150,000 5 years ago is likely valued at $100,000 today. Any improvements made to your home today will have an exponential impact when the housing markets turn around. For example, investing $10,000 in your home today could result in a $15,000 return in the future. Simply because house prices are low now, does not mean that they are realistic or will stay low in the future.
Do not fear making home improvements now even on a limited budget. Home improvements are reasonable and sensible decisions even in a faltering economy, perhaps even more so in a slow economy. Many homeowners interested in selling their home now will quickly realize that the market is full of homes for sale and selling a home is difficult at the moment. So make some improvements to your own home, enjoy it for a few more years, and sell when the economy turns for the better and you will sell profit from your home improvement investment.