One of the first questions owners ask before putting a home on the market is whether it is worth spending money on renovations.
A renovated home may sell for more. But renovation costs money, and the higher price does not always cover the full cost of the work.
Before you start building work, consider which improvements could help sell the home and which are unlikely to pay for themselves.
Will a renovation leave you with more money?
A renovated home usually makes a good first impression and can attract buyers who want to move straight in.
There is a difference, though, between securing a higher price and recovering everything you spent on the work.
For example, spending a substantial sum on a full refurbishment does not necessarily mean buyers will pay that same sum on top of the home’s present value.
Buyers may value the improvement but will still compare your home with similar properties nearby.
Before renovating, find out what the property might sell for in its current condition and what it might be worth once the work is complete.
You can also read our guide to how much a house in Palma de Mallorca is worth.
Which improvements are worth making before selling?
You may be able to make a difference without undertaking a full refurbishment.
In many homes, small improvements can make a considerable difference to buyers’ first impressions:
- Repaint walls.
- Improve the lighting.
- Carry out minor repairs.
- Tidy and declutter rooms.
- Remove worn furniture or pieces that crowd the space.
- Give the property a thorough clean.
- Tidy up terraces, courtyards and gardens.
These changes usually cost much less. They can improve the photographs and the impression buyers take away from a viewing.
When might a full refurbishment be worthwhile?
In some circumstances, more extensive work may be worth considering.
For example, a very dated layout, outdated electrics or plumbing, or a poor state of repair can make it difficult for buyers to picture themselves living in a home.
Before deciding, consider:
- The total cost of the work.
- The highest price a home like yours could command in the area.
- The kind of buyer the property usually attracts.
- How long the work will take.
- How much you are likely to gain once costs are deducted.
Look at a refurbishment as an investment, taking more than its visual appeal into account.
Some buyers are looking for a home to renovate
Some buyers actively seek properties that need work.
They want to renovate a home to their own taste, especially if they can buy it at a more competitive price.
This is true in Palma and in places such as Marratxí, Santa Maria del Camí, Consell, Binissalem, Lloseta, Inca, Algaida, Sencelles, Llucmajor, Campos, Felanitx and Manacor.
In these areas a home that needs work can sell perfectly well if its price reflects its condition.
The difficulty comes when a home that needs renovating is offered at almost the same price as comparable homes that have already been updated.
Price still matters more than renovation
A renovation may help, but it cannot put an unrealistic asking price right.
If your asking price exceeds what buyers will pay, you may receive few enquiries even after a full refurbishment.
Equally, an older home can attract plenty of interest if the price makes sense for its location, features and condition.
Setting the right price at the outset remains one of the most important decisions in selling a home.
Our article on mistakes to avoid when listing a home in Palma de Mallorca looks at decisions that can make a sale harder from the start.
What if the home needs extensive work?
If a property needs a major update, you generally have two options.
You can renovate before selling and market it to people looking for a home they can move straight into.
Or you can sell it in its present condition, allowing for the buyer’s renovation costs in the asking price.
The best option depends on the home, the area and how much more the property could realistically sell for after the work.
Work out how much you can recover before you renovate
Starting major work without knowing its likely effect on the sale price is rarely a good idea.
Before committing money, compare:
- The home’s approximate current value.
- The cost of the work.
- Its potential value after refurbishment.
- How long the work will take.
- Demand for that type of property.
In some cases renovation is a sound decision. In others you could come out ahead by selling the home as it stands.
Thinking of selling your home?
We help owners sell their homes across Mallorca, including Palma, Palmanyola, Marratxí, Santa Maria del Camí, Consell, Binissalem, Lloseta, Inca, Algaida, Sencelles, Llucmajor, Campos, Felanitx and Manacor.
If you are unsure whether to renovate before selling, we can look at your property in its current condition, the demand in your area and the options that make sense for your sale.
Before spending money on building work, explore How to prepare your home for sale.
