Generally, I enjoy watching HGTV. It’s terrific for ideas on staging, updating, landscaping. But please, remember this is entertainment…and some of the advice given is really BAD, in my opinion.
One of the worst shows, IMHO, is My House is Worth WHAT.
My House is Worth What features a real estate agent taking on the role of an appraiser, and homeowners discuss borrowing more money based on these “expert opinions.” They are told, without any kind of disclaimer, that if they spend more money and do “X” they will see many thousands of dollars back on that investment, making their home worth $50,000 to $100,000 more…
After a quick tour, the “expert” says “If I were to put your house on the market, I would list it for….” and then the 
homeowners are either crestfallen because it came up “short” or they’re “elated” because NOW they have the green light to spend more money on their house!
They never mention that the listing price is often quite a bit higher than the selling price – and a mortgage appraiser is probably going to be more conservative about the value of those upgrades. Additionally, there are thousands of dollars of seller’s closing costs which will also come out of that sale price.
Avoid Overimproving For Your Neighborhood!
Here’s my Tuesday Tip: If you’re selling your home, avoid doing any major remodels or upgrades unless really necessary. Be sure you can afford the improvements without going further into debt and sacrificing too much equity!
Also, beware of “over improving” for your neighborhood…it’s difficult selling a $350,000 property surrounded by $120,000 homes.
Buyers don’t walk into a home and say “Look, honey, granite counters and stainless steel appliances! They spent $35,000 on this kitchen! Let’s offer $50,000 above the asking price ’cause it’s so pretty!” In this market, they’ll likely start out at $100,000 below asking price to see how “flexible” or “desperate” a seller you are!
Remember, real estate agents are not appraisers. We can give you educated opinions – but they are only opinions. And yes, Virginia, even real estate appraisers make mistakes.
A Pike County home sat on the market for about two years – appraised at $475,000. I have no idea how that appraiser came up with that figure – but hey. The home eventually sold for well below $300,000. I know of another that “comps out” at $160,000, but the homeowners were given an appraised value of $240,000. Thankfully they didn’t refinance for that amount!
If you want to renovate/remodel for your own pleasure – go for it. Do what you want to your home to make it YOUR home – just be aware that you may not see as much of a return on that investment as these television shows may lead you to believe. HGTV is not educational – it’s entertainment.
So, what kinds of things should you do to prepare your home for sale? Coming soon!
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Green light photo by Ted Percival, House images by Woodley Wonderworks, via Creative Commons.
Filed under: Home Improvements, Home Sellers, Tuesday Tips | Tagged: appraisal, equity, Home Improvements, Pike County PA, real estate, selling your home
I don’t know why I continue to be amazed that people will customize homes to fit their own wants/needs and then expect that a buyer will repay them for the time and every penny spent doing it. These TV shows gives sellers an unrealistic expectation of what can be accomplished through cleaning and updating. Sometimes that’s what it takes just to get a house to the same level as the competition and be seen as a comparable.
Lisa, thanks for the comments. I was also going to rant about Donna & Shannon Freemans “Secrets that Sell” show and decided it was too long-winded, and I’ll save that for another blog!
If only selling real estate were as simple (and profitable!) as it is on HGTV. I love Designed To Sell – but you and I both know that adding crown molding, switching out some drapes, and painting the front steps will increase curb appeal, but that doesn’t mean it’s going to sell at the next open house for $10,000 above asking (with multiple offers no less…)
Our market is one in which there is no added value for a finished basement (even top notch) it just will be the difference between a home that sells and the one next door which sits and sits without offers.
Crown molding sounds like a simple fix but I would have to agree it doesn’t change major impression/offer from potential buyers.
Karen – I watched one episode from my town. The comments about what was adding value was just ridiculous for our area. Some of the advice those shows on HGTV give are just off the mark. Speaking with an agent who is trying to help you sell your home and not one who is trying to sell a show is the best advice.
Karen, I SO enjoy your blog…always informative, and entertaining.
Kudos for speaking out against Housing Porn…it gives folks the false notion that real estate is akin playing the lottery. A home is a place to live, unless you’re a serious long term investor. It is not supposed to be your retirement fund or a cash machine, though all of these sorts programs would lead you to believe otherwise.
The hostess of My House is Worth What? (which we loving refer to My House is Worth SQUAT?!? in my home), Kendra Todd, is credited with saying quite openly ‘There is no housing bubble…bubbles are for BATHTUBS’. YIKES!
Granite…I never got it. To me, it’s just something else I can smash my head on when I trip. Danger!
There’s a home on the market on RT 590 near Lakeville…a slightly oversizd cape cod on half an acre…sharing a driveway with a teeny tiny ranch home that would sell in the 100K range…and their asking price is 675K. No, there is no lakeview. It doesn’t come with lifetime box seats at Yankee Stadium. I just can’t help but wonder how much THEY overupgraded…or what the agent and/or appraiser was smoking when they were checking facts.
Thanks again for all your posts, Karen. You’ve made many a lunchbreak reading session very amusing.
I do watch HGTV but hardly follow or listen to them, I have my on instincts that help me go for what is right! thanks for this post.