Smart Moves by Ellen James Martin


Less than a year ago, an IT specialist and his schoolteacher wife got the itch for a beautiful new kitchen, one they could show off to neighbors on their suburban cul-de-sac. Impulsively, they selected Brazilian hardwood cabinets, along with high-end quartz countertops, and soon they'd run a $40,000 tab.

The couple loved the new kitchen. But their plans to keep the house changed suddenly when they found a better property in a bucolic setting with more space for their kids. With just four months to move, they called their real estate broker, Sid Davis, to say they needed to sell the suburban place quickly.

He took the listing, but gave them bad news on pricing: they could expect to recoup no more than half their kitchen investment when the house sold. That's because they'd raised their kitchen above the standards of their moderate-income neighborhood.

This true story illustrates the risks of "over-improving" any home above neighborhood norms, says Davis, the author of "A Survival Guide to Selling a Home."

Mark Nash, a long-time real estate broker and author of "1001 Tips for Buying and Selling a Home," cautions all homeowners to proceed cautiously before committing to costly upgrades.

That's not to say that upgrades shouldn't be made at all, Nash cautions.

A dated kitchen is a "gigantic turnoff," says Nash, noting that it's critical for sellers to at least replace odd-colored appliances, metal cabinets and scratched countertops. Also, he strongly recommends replacing beat-up kitchen flooring.

"Sellers should also consider replacing old, drafty windows. That's because the current generation of buyers is highly attuned to the energy savings and comfort that comes from new windows," he says.

Here are a few tips for sellers:

-- Look to local real estate pros for advice before you renovate.

Even if you have no intention of selling immediately, Nash recommends against signing any home improvement contract until you've asked for the advice of someone who has sold real estate in your neighborhood for at least five years. That person should be able to tell you how much of a project's cost you can expect to recoup.

Those who are unsure how long they'll stay in a home are often hesitant to ask a real estate agent for advice until their selling plans are solid. But Nash says a reputable agent should be happy to help, even if you have no idea when you'll sell.

"Another plus is that good agents from your local market should be in touch with contractors. They know folks who can handle any work you decide to do smoothly and expeditiously," Nash says.

-- Keep an eye on neighborhood standards.

Tom Early, a real estate broker who was twice president of the National Association of Exclusive Buyer Agents (, says current home purchasers are especially resistant to paying for renovation work that raises a property above local norms.

What sorts of upgrades constitute "over-improvement"? For example, Early says you wouldn't be justified to install expensive antique light fixtures in a neighborhood of starter homes. Likewise, you couldn't recoup the full cost of building a three-car garage in a community where most homes have no garage at all.

-- Slow down the renovation process to avoid over-doing it.

As many homeowners realize too late, a thoughtlessly done pre-sale renovation can hit the wallet hard.

For instance, Davis says the IT specialist and his schoolteacher wife, who'd originally planned to opt for moderately priced Corian countertops, slipped into the quartz upgrades without planning to. The same was true about their choice of Brazilian hardwood cabinets.

"It's easy to spend a fortune on household renovations. And you're most at risk of over-spending when you rush into renovations," Davis says.

-- Cut your losses on projects that prove too extensive.

It didn't dawn on Davis' clients that they were spending too much on kitchen upgrades until their $40,000 project was underway. But Davis says they should have paused things once they'd realized they were spending too much.

If you think you're going over the top, he recommends you contact all your contractors to negotiate your way out of expensive upgrades. For example, you might decide to cancel top-brand bathroom and kitchen fixtures in favor of something more generic.

"Average buyers don't care if they get super fixtures or appliances in any given room. It's the overall house that they're looking for -- not perfection in every room," Davis says.

"Even if you're compelled to pay penalties to back out of some work, you could ultimately save money by dropping the most costly elements of your renovation plan," Davis says.

(To contact Ellen James Martin, email her at