Remodeling Your Home for Resale in San Diego

The approach to remodeling your home for resale is quite different than what you would do if you were to remodel for yourself. When doing it for yourself, it is always better to go into as much detail when it comes to requirements, as a good general contractor can do everything exactly as you want it. For resale, it’s better to aim for a wider appeal.

Overall, remodeling for resale is always a good idea, as you will gain more with the sale than you would spend on the remodel. Especially if the home itself is aching for a remodel by itself, the cost/benefit is clearly on the side of remodeling and renovating the abode.

If the home is freshly remodeled, those benefits may still exist, but they won’t be as nearly significant in the amount itself, especially if big items like a kitchen remodel have been done recently. Where they would be noticeable is how quickly the house will sell.

There are also a lot of things outside of your control when it comes to the property you are selling. What the location, what the public amenities are, and how good the local school is are well beyond your immediate control. Thus, your remodel will be aimed towards buyers who want those features and you should add whatever they would pay a premium for.

While you are aiming for a wider appeal, that means more like “not only you want to live there”. You will still be selling to a niche of buyers who might be interested in a property of that type.

When Remodeling Your Home for Resale is a Good Idea?

If you are dealing with a fixer-upper, then a clear solution is to fix it. But, even if you are flipping a home there are aspects that might make that deal simply not viable. The Internet usually shows us people who have succeeded and not those who are in financial strife because of their decisions.

Primarily, the question is if you are buying a property to remodel or if you are selling a house you have owned for a long time. Full disclosure: commercial resale is way more difficult and is not for beginners. The margins for profit are way narrower when you have all of the taxes and fees to deal with.

But, when it comes to property you already own and even live in, a lot of remodeling can be counted as a deductible on your taxes and make the remodel even more worth it. While you will still need to calculate your maximum ROI to know which type of investment renovation you will make, the margins are usually much bigger and the benefits are clearly visible.

The final aspect is who will be doing the renovation. Generally speaking, considering the market in Q3 2024 and its tendencies, there are objectively only two viable options. 

Primarily, there is the option to use an experienced general contractor who will be familiar with the locale and the work you have in mind. For any affluent neighborhood, this is the only viable option.

The second is the budget option where you are buying a rundown property and would renovate it yourself. Even here it is much better if you have experience and at least buy consultations from designers, real estate agents, and contractors to learn what you should be doing.

Market Assessment

We often hear how the real estate market is doing in general. But, those numbers are shown as aggregate and could mean nothing for your situation in particular. Each seller, and by extension each remodeler, needs to find the exact niche in which their estate will be sold and aim to maximize value in that direction.

Additionally, it would be a mistake simply to see the highest asking price in the neighborhood and aim for that. Plainly said, there are too many moving parts for someone selling their home first time in years or decades to make an optimal choice.

Your best option is to call at least an agent if not a GC and to collect as much info as you can. It’s way better to spend a few thousand to learn that you shouldn’t renovate your home than to spend stacks upon stacks only to lower your objective chances of selling the property.

Living Space

Increasing the living space is by far the easiest way to increase your property value. At the moment, California even has an ADU or Auxiliary Dwelling Unit scheme that helps in funding additional units on the same property, but you can extend some rooms even without adding units.

Take note to make it reasonable as there is a point that a grotesquely oversized building would diminish the value of every square foot enough that remodeling your home for resale in San Diego in that way would simply not be worth it.

But, building a second story, adding a room over the garage, making a summer kitchen, or turning the pool shed into a guest bungalow can always be a good idea and work seamlessly with the composition of the house.

The Feel of the House

In sales, it is a well-known fact that you don’t sell the product as much as you sell the feeling; the same is true for real estate. There is zero chance of you selling a modern AI-empowered house to people who are looking for a rustic cozy homestead. 

Same way, building a yard reading nook for those who love modernism is a waste of money, as they will need to pay to tear it down.

When you are remodeling, it is always better to go with the original intent of the house. If it’s an old Spanish colonial style hacienda, installing steel and concrete would be a waste, and might end up looking neither here or there.

Alternatively, if it’s a practical modern design it is always better to focus on amenities and modern conveniences, as that will be what the buyers of such buildings are looking for.

Amenities

All additional features, extra rooms, or out-of-the-ordinary conveniences add value to your property as a percentage rather than nominally. Nobody will give you $50k more for a pool in a $300k house, nobody cares that much. But, a house that would sell for $2M might sell for $2.2M just because there is a pool and a hot tub in the yard.

Having a pool is the most obvious addition, but not the only one. If there isn’t a garage, and there are allowances for one, that is the best investment. Smart features, cameras, security, a nice driveway, or solar panels are much less apparent, but also something that might invite buyers who are willing to pay just a bit extra per foot, which is way more than you invested in the system.