Often times when showing homes to buyers, they become fascinated by the cosmetic updates of a home. Most of the time it’s something that’s pretty nice and/or trendy. These days the 'go-to' seems to be white kitchen cabinets, granite countertops, and dark hardwood floors. But it could be anything... the way a seller has done their bathrooms, lighting, basement, etc. The reason that a fancy kitchen or other shiny cosmetic update may catch a buyer’s eye and persuade them to eventually buy that home is because it will do the same for their friends and family; as a new homeowner, you’re going to want to show off your home—most of your friends aren’t going to care that your roof is 20 years old, but they’ll love your kitchen. This sort of mentality may not just be that of family and friends but also the homeowner. Of course if you have the money to get everything you want, then by all means do so. However, if you’re looking at homes realizing that you may have to cut some items from the 'want-list' then be wary of buying a home that has a great cosmetic update despite a less noticeable feature in need of repair—roof, windows, HVAC system, septic tank, siding, etc.—you may be in for more than your realize in the near future. I’m here to tell you the potential cost/value of some of the things that don’t always catch your attention. Let’s talk a little… You’ve probably heard the phrase, “this house has great bones.” This phrase means the cosmetics of the home suck, but it’s laid out nicely and built well enough for you to remodel it. There are many homes out there with great bones, but they still don’t match all the beautifully upgraded homes that you see on HGTV and DIY Network. There's many different styles as well, so even if it's updated, it may not match what YOU like. In addition, we all seem to suffer from a little upgrade-snobbyness when it comes to homes. Older homes that haven’t been updated may not be that way due to a lack of funds, but rather the current homeowner’s taste. We’re all so used to the remodeled homes on TV that we forget that it’s possible the current homeowner actually likes their outdated home. In either case, it seems that many buyers are looking for their perfectly updated home. There are many reasons for an outdated home and it really doesn't matter why. The only thing that matters is that you don't like it that way. Why is that? Everything works right?
Like I mentioned before, it's more fun to show off the updated kitchen—not as fun to show off the great school district you paid for, or the new siding and windows that were done right before you bought the home. The materialistic mentality that our society suffers from has been made even more evident with the ability to show it off through social media. I feel this may lead several younger generations (including my own and dare I say "millennial"?!) to poor home purchase decisions. They couldn't possibly take a selfie in front of their 1997 kitchen cabinets! So instead they may be tempted to stretch their budget, buy a home with the cosmetic upgrades good enough for facebook photos; all the while, the roof is about to blow away, the furnace and AC units are 25 years old, and the windows are painted shut... but they look great. When the furnace finally does go, they may be in finanical trouble trying to afford a new furnace. In order to avoid this, we're going to have to get over the perfect Pottery Barn home, so let me help you cope a little...
When buying a home, the odds are that you, a home buyer, will need to compromise on something. Instead of freaking out about the Coca-Cola wall paper in the master bedroom, try to look at the more important and costly items in the home. Remember that even though your kitchen is from 1985, it still works, but a 25 year old water heater is bound to not work pretty soon, which results in potentially big problems and inconveniences—much more than an eyesore—and will cost money. I’m honing in on things like roof, windows, siding, soffits, sump pumps, and utility features.
***Sidenote (haven't done one of these in a while). Kitchen appliances can be big too. I could throw them in as part of my points, although, they are usually part of a cosmetic need as opposed to a repair need.
The counter still functions no matter how ugly it is, but a broken furnace is a safety issue...
The list of items I just mentioned are the type that must be replaced if they’re not functioning properly; when those features get old, they aren't just ugly, they will likely cause on-going damage if not fixed. Even waiting until they break can be too late. It’s about choice. Outdated and/or ugly still-functional features are invaluable when it affords you the ability to maintain the ware-able, tear-able, break-able important things. The choice is the key. Typically cosmetic updates are done out of choice not function or safety. I.e. the counter still functions no matter how ugly it is, but a broken furnace is a safety issue. You don't really have a choice when it comes to the furnace. Even worse, you don't have a choice of whether or not you can afford it.
Let’s look at some estimates (compliments of HomeAdvisor.com).
These items are often things that become worn and need to be repaired or replaced, but they may not catch your eye when walking through a home. Knowing the cost of these things is important when shopping for homes. When you walk into a home with new windows, roof, and siding… you need to understand how important that is. You shouldn’t have to incur those costs (listed above) for 20-30 years. Most of these items only need to be replaced once every 10-30 years; they are long-term purchases. When you buy a home that has already incurred the cost of these replacements, it can give you time to save up for your new kitchen and hard wood floors.
Searching for a house with “good bones” and/or Not-so-shiny upgrades [...] can be a great decision for you...
The other thing to think about is kids and pets. As you buy and have children, there is no debating that the kids and pets will destroy all of your nice things. Coloring, spilling, peeing, pooping, scratching, biting, etc. It might be a good idea if you are planning to have kids/pets, or if you have very young kids/pets, to save the cosmetic upgrades for later and let the old stuff take the beating. In this case, searching for a house with “good bones” and/or Not-So-Shiny (there's the title) upgrades like a new roof and windows can be a great decision for you.
AND! The cherry on top of this amazing home buying sundae, is that there is a large price gap is growing right now between updated homes and outdated homes. Read my post Is it a Buyers’ or Sellers’ Market??? Neither, Here’s Why… to learn more about this gap. You’ll be able to get a better deal on the outdated home with good bones, while the new shiny updated one will have a much higher sales price. The gap between the two is most likely more than what it would cost to upgrade the outdated home; upgrading the outdated home will afford you a bump in equity, along with your personal taste while you live in the home. Also, you should have peace of mind knowing that the not-so-shiny important stuff has already been taken care of. If you combine this idea with the fall/winter market you’ll be able to get a steal on a house! Read my post Is Fall really a good time to sell? Ummm… no, no it’s not. to see the data on this.
As you shop for a home, be careful not to discount the “ugly” home with a great personality. It might be the gem that saves you a few headaches and affords you a great profit in the future. But you'll have humble your Facebook profile, and settle for outdoor pics only... until you re-do the kitchen and the floors, then you can come out of hiding and let the world see your home ;)
Please contact me if you are interested in selling or buying. Comments and questions are welcomed!
Thank you for reading!