Renovate or offer a discount: Is the effort worthwhile before selling?

Sell ​​in top condition or at a bargain price? Many owners wonder before selling their property whether a renovation shortly before the sale is still worthwhile or whether they should offer the house unrenovated with a price reduction.

First impression: What flaws deter potential buyers?

Prospective buyers often make intuitive decisions – the first impression determines whether they feel enthusiasm or rejection. Yellowed wallpaper or a musty-smelling basement leaves a bad impression during viewings, and even if these flaws are only superficial, they can often be remedied with minimal effort: a fresh coat of paint, clean windows, a tidy garden – and the house already appears more well-maintained and inviting.

The situation is different with serious problems. A leaky roof, an outdated heating system, or moisture damage in the masonry deter potential buyers, as these will result in high renovation costs for the new owner. A seller usually cannot compensate for such major issues with a higher selling price. Therefore, it's important to distinguish between purely cosmetic defects that can be remedied with a manageable investment and those that significantly reduce the property's value because expensive repairs are required

Example calculation: What a renovation ultimately brings in terms of results

Let's assume that, in its modernized state, the property could fetch around €300,000. Without renovation, however, one would have to expect €20,000 to €30,000 less – a selling price of approximately €270,000. If the owner were to invest this €20,000 in the modernization himself, the price could be increased to around €330,000. After deducting the costs, a profit would remain.

However, this calculation only works if the measures are implemented professionally and with the target group in mind. Those who cut corners in the wrong places or miss the mark with potential buyers risk not achieving the hoped-for price increase. Generally speaking, renovations before a sale are only worthwhile if they improve the overall impression and are rewarded by the market with a correspondingly higher bid.

Market situation: Sell or invest in the current state?

Whether renovating pays off depends heavily on the current market situation. In a boom phase with high demand, even "unassuming" houses or apartments quickly find a buyer. Conversely, if the market is relaxed and supply is plentiful, a freshly renovated property can provide a decisive advantage. Some buyers specifically seek out properties in need of renovation in order to acquire them cheaply and then modernize them according to their own preferences. Others value a move-in ready home and prefer to pay a bit more for a property that has already been renovated.

Ultimately, every seller must carefully weigh the costs and benefits – and seek expert advice when in doubt. Depending on the situation, either selling "as is" or renovating beforehand might be the better option.

Undecided? We 'll assess your property in its current condition and determine the selling price you could achieve with and without modernization. Contact us by email or phone – we'll help you make the right decision.

Notes

For the sake of readability, this text uses the generic masculine form. Female and other gender identities are explicitly included where relevant to the statement.

Legal notice: This article does not constitute tax or legal advice for any specific case. Please consult a lawyer and/or tax advisor to clarify the facts of your individual situation.

Photo: © Brett Jordan/Unsplash.com

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