The seller had a tree in her yard that had died many years ago. The tree first lost its leaves. Then it lost some branches, and then, some bark. The leaves were cleaned and hauled away and the branches, too. The bark was mowed over and made into mulch, and no one much cared. But the tree was there in the yard near the lake and it was dead. When I came along, the tree had been dead for some time. The owner was going to have that tree removed. And so after several months of discussion the tree was removed. The owner was pleased with her new view, and touted the tree removal as a feat of great success, one that would surely lead to a most immediate sale, now that the tree was gone and the view improved.
Another owner replaced his formica countertops with ones of granite. The granite was $3100, and what a lofty sum that was. The crew arrived on time and with little effort had removed the offending, 28 year old countertops. Soon after, the new tops were carried in and glued into place. They shone with the light of a thousand candles, the proud owner’s face reflecting the glow. The house had lagged on the market for some time, but now, with these countertops, who could resist the over-market price tag? That night, the counters were wiped clean with the wipes the granite company left. The owner turned off the kitchen lights and felt the deep satisfaction of a home improvement well done.
The problem with these scenarios is that neither represent an actual improvement to a house. This is going to come as a shock to some, but cutting down a dead tree does not enhance the value of ones home. The tree, you see, should have been cut down as a matter of course, not as a special capital improvement project. In the same way, a new furnace and hot water heater don’t matter when pricing a home for sale. Will a new hot water heater and furnace help a buyer out and perhaps encourage them to make an offer if they are considering a similar home that doesn’t have these new mechanicals? Of course, but improvements they are not. This revelation runs contrary to everything every home seller has ever thought, or will ever think.
The tree example is a true story. The countertop story, true also. The hot water heater and furnace, I hear that all the time. The roof was old and so it needed replacing, improving. The bill was $8500. That’s a lot of money, after all. A new roof is nice, but it’s not an improvement. Neither is the furnace. Neither are the countertops. Neither is the dead tree that you removed. That’s all maintenance. Maintenance is not capital improvement, it’s just something that everyone who owns a home has to do. The tricky part is what exactly constitutes regular maintenance and what might veer off into the actual improvement category. But I joke, because that’s not tricky either.
New countertops on top of your existing cabinets, maintenance. New countertops, cabinets, appliances? Improvement. New appliances? Maintenance. A new hot water heater? Maintenance. Replacing an asphalt composition roof with an asphalt composition roof? Maintenance. Replacing a three tab composition roof with an architectural shingle, still maintenance. Replacing that roof with a cedar shingle or slate? Improvement. Fixing your deck posts because they were rotted? Maintenance. Replacing your entire deck with Ipe, improvement. You can see how this isn’t all that difficult, but it’s a concept completely lost on the modern day seller.
So when you tell me that you’ve painted your windows and fixed your leaky roof, please don’t expect me to be thrilled. It’s just maintenance. It’s no different than if you go to trade your car in. What a beautiful shiny car it is! But it’s old and it has 180,000 miles on it, and there’s a tear in the driver’s seat. When you bring it to the dealer and he offers you $3500 on trade, you should then interject that you recently had the oil changed and you ran it through the car wash. He’ll be thrilled and then he’ll give you $4000. Just kidding, he’ll give you $3500, because oil changes, like new roofs, are just part of life.