The spring real estate market has been one of the busiest in nearly a decade, with homes moving the fastest since the start of the housing recovery, and asking prices reaching record highs. As the summer market heats up, first-time homebuyers are expected to make significant contributions to the already-impressive buyer pool, catapulting demand higher than it has been in years.
It is in every seller’s best interest to meet the demands of first-time buyers. Remember, selling is a numbers game; the more people a home appeals to, the more likely it is to sell in a timely and profitable transaction.
Provided millennials and first-time buyers show up in the numbers they are expected to this summer, those looking to sell are advised to take note of what their buyers will want the most.
If you want your property to attract what is expected to be one of the largest homebuyer demographics this selling season, consider making the following adjustments:
1. Remodel the kitchen and baths
Kitchens, and bathrooms to a slightly lesser extent, are widely believed to be the home’s most important selling features. That’s not to say that there aren’t other factors to consider at the time of a sale, just none that have the same impact as these respective rooms.
Nothing, for that matter, can simultaneously add more value to your home and increase its viability in the eyes of prospective buyers. This selling season, perhaps more so than ever before, kitchens and baths are expected to contribute to sales.
According to HGTV, “Your kitchen renovation should earn a 70 percent return on investment when you sell your home. But this depends on the features you choose, how much you spend remodeling and whether your priority is to create a dream kitchen for yourself or a kitchen that will appeal to potential buyers.”
I highly recommend checking the comparables in your neighborhood to understand better what remodeling might entail. When all is said and done, your kitchen should be slightly better than your neighbors’ as to make your home the preferred choice.
2. Knock down a few walls
Open floor plans have been trending for quite some time, but it wasn’t until recently that first-time homebuyers started to prioritize them on their list of “must-haves.”
According to a recent MRIS survey, 59 percent of first-time homebuyers have acknowledged open floor plans as one of the most important features they will look for when buying a house this season.
Sellers should accommodate the needs of the broadest audience possible, which, coincidently, happens to be the open floor plan. Not surprisingly, open floor plans have become synonymous with every generation, so there is no reason you shouldn’t at least consider opening things up.
As a seller this summer, I highly recommend appealing to the audience that values the concept of the open space the most: millennials.
However, most homes built before the turn of the century are more confined and closed off. That said, any attempt to meet the needs of the growing millennial population should be met with a hammer, and perhaps a few support beams.
That’s right, homeowners with older homes should consider knocking down a few walls to meet the needs of today’s buyers.
You would be surprised at the transformation that can take place when you remove a wall separating the kitchen from the living room. It’s entirely possible to change the entire feel of a home, both physically and emotionally, by simply removing one wall.
Of particular importance, however, is the appeal it will generate with prospective buyers. Remember, the more people you can draw interest from, the more likely you are to sell at your asking price.
3. Reduce post-purchase maintenance
Last year was expected to be the year in which millennials and first-time homebuyers made their triumphant return to the housing market.
And though they did represent the largest pool of buyers, they didn’t come out in the droves many had expected. For all intents and purposes, the costs of homeownership and other obstacles impeded many from making the jump.
Fortunately, 2016 appears ready to meet the expectations set last year. Millennials are expected to be the largest demographic of buyers for the second year in a row.
However, their participation is met with cautious optimism. Although many are committed to purchasing their first home, the last thing they want is unexpected costs to creep up.
Sellers are therefore encouraged to reduce the amount of post-purchase maintenance a property will require before they even list it. Of course, you need to weigh the cost of potential upgrades with the amount they will recoup at the time of a sale, but do your best to eliminate burdensome costs that could scare away younger buyers.
Consider your return on investment before commencing a project, but understand that it will be worth it to put a little money into a project if it attracts more buyers.
If your kitchen could use a new dishwasher, don’t hesitate to replace the existing one. Not only will you be able to attract more buyers, but you will also reduce the amount of maintenance required upon moving in.
Remember, most millennials are probably already strapped for cash; don’t contribute to the burden of homeownership by selling them a property with a lot of maintenance needs. Most will be looking for a home that is move-in ready and doesn’t require additional upfront costs. It will certainly be worth spending a few extra bucks if it draws more interest to your property.
4. Think energy efficient
Energy efficiency has increased in popularity, and for good reason. For starters, it reduces our carbon footprint and contributes to the preservation of our natural resources. However, energy efficient homes have the added benefit of saving homeowners money. What’s more, the right upgrades have the ability to compound savings over the life of a home.
Let 2016 be the year your clients finally commit to making green upgrades to their home. You would be surprised at how attractive a few energy-efficient upgrades can make a property to buyers this summer.
According to a recent Cost Vs. Value report on Remodeling.com, adding insulation to your attic is a great place to start. In fact, the addition of fiberglass insulation to your attic is the most cost-effective way to add value to your home.
According to the report, fiberglass insulation in the attic has the highest return on investment. Setting homeowners back approximately $1,268, this relatively easy project has the potential to recoup 116.9 percent of the initial cost when it comes time to sell.
According to Energy Star, “Homeowners can save an average of 15 percent on heating and cooling costs (or an average of 11 percent on total energy costs) by air sealing their homes and adding insulation in attics, floors over crawl spaces and accessible basement rim joists.”
It is entirely possible for the energy efficiency of a home to become one of its premier selling points.
Above all else, consider one thing; the more people you can get to appreciate the home, the more likely you are to sell it in this competitive selling season.
In doing so, I recommend appealing to the broadest audience possible: millennials. Take note of what it is they are looking for this year and incorporate it into the home before you put it up for sale.
Not only will you likely attract more buyers, but there is also a chance you could even start a bidding war. Don’t sell yourself short this summer, and make the right adjustments to your property to maximize its potential.
Than Merrill is the founder and CEO of FortuneBuilders and CT Homes. Connect with Than on LinkedIn or follow him on Twitter @ThanMerrill.
