I just don’t buy it.
I read an article put out by the National Association of Realtors and the National Association of the Remodeling Industry. It said putting on a new roof is the biggest single item a seller can do to get the highest return. They said it increased the value of a house by 105%. Get this, remodeling or updating your kitchen only brings back about 67% in added value.
I laughed so hard I snorted a little.
About 50% of my work is with buyers. I sell a lot of houses. I have been doing for over 10 years. My experience in and around Lexington Ky is that very few buyers even notice the age or condition of the roof. The HVAC too for that matter. Most buyers care more about the appearance of the house than anything…..assuming they were okay with the location to have even considered viewing the house. Most don’t think about the roof (or windows or HVAC or water heater) until the home inspection. That is why I always try to think about these things for them. I am always telling people the age and condition of the roof and the rest of the house. In fact, I’m working with a buyer right now who fired their old realtor because they kept making offers on houses that were in terrible shape and the deals fell apart after the home inspection. The last thing I want is a client of mine to emotionally move in, tell their friends and family all about the house, and then it fall apart after the home inspection.
Several years ago I listed a house for some clients/friends have used me several times. Their house had new windows and literally a brand new roof. The house was a bit outdated. They found their dream home before doing much inside to this one. The seller knew a lot about houses and wanted to take care of those big items first. LOL, I guess I am the same way because I am sitting in my own home, that has a new water heater, sump pumps and I am about to put in new windows…..yet I have a master bathroom that dates back to when Dallas and Knots Landing were new shows.
I put their house on the market. I showed it several times. It took a while to sell because it was outdated. I would remind buyers that there was $15-20k in windows and the roof that they would not have to spend. I would tell them it is more fun to spend that much on flooring and granite than to buy another house that was updated inside but would need new windows and a roof. It finally sold, but my point is that most buyers make decisions on how updated a house LOOKS. That is just how it works. 99% of the time, I would rather have my sellers drop money on updates that can be seen verses maintenance items than cannot. Unless a roof is just ancient or really ugly, most buyers don’t care as long as it doesn’t leak.
So, I totally disagree with this report. It just isn’t happening in my area.
And ALWAYS consult with a knowledgeable real estate agent in your area before making big decisions. I spend a lot of time advising friends and clients about how to spend money on their houses. You need somebody who knows the market and even your neighborhood to help make decisions.
There are a lot of variables depending on your neighborhood and price range.
We had a hail storm several years ago in South Lexington. Almost everybody got a new roof. The norm in those neighborhoods was to have a new roof. Buyers expected a new roof. It was a negative in that situation to not have a new roof.
There are several neighborhoods that are about 15 years old right now. The norm is to have original HVAC and roof. Since buyers will be viewing houses that all have an older roof or HVAC, a seller would do better to spend money updating the interior if they are considering selling any time soon. If they plan to stay forever, it is okay to spend their money any way they want.
neighbohoods
What The LEXpert has been thinking about
Here are some things that have been on The LEXpert’s mind lately:
- I am seeing more and more interest in the houses around Liberty Road and Henry Clay Blvd. About 25 years ago I saw that once Kenwick got expensive, interest would move to the Courtney/Clayton area. And once those prices shot up, it would keep going further down Henry Clay Blvd. What I didn’t see back then was that Delaware would become a hip spot for businesses and restaurants. Back then, we all thought it would remain the scuzzy industrial area it had always been. You watch, once the National Avenue area gets filled and rents go up, you’ll see more businesses you want to frequent along Delaware and Winchester Road. The great thing about the Henry Clay/Liberty Road area is that you are minutes to downtown, minutes to NoLi, and minutes to Hamburg. It really is an ideal location.
- Greenbrier is seeing a lot of sales. I have seen several that sold by word of mouth lately. A couple others sold extremely fast. I think it mostly has to do with the new school districts. It is no longer a nice neighborhood on the wrong part of town thanks to Hamburg. It is also no longer a nice neighborhood with a poor performing school district. It will attract people who want to have their kids in public school now. That makes for a broader market. That means more buyers for fewer houses. That means prices go up.
- The $350-500k market is strong in Lexington still, even as we get late in the year. Sales seem to come in waves. There might be a few slow weeks for certain parts of town and then, all the sudden, that area will have lots of sales in one week.
- Century Hills is blowing my mind. I have seen several 3 bedroom/1 bath houses without a garage sell for over $100k, some close to $110k. It wasn’t too long ago that the nicest ones out there were $95k! Percentage wise, that is a huge increase. Looks like we are back to the days where under $100k doesn’t get much.
- I think that the new Citation Blvd is going to be a big gain for the west side of town. That road really ties together all the neighborhoods between Georgetown and Leestown Road so well. It is easier to get in and out of that area too. It nolonger feels like a bunch of random neighborhoods scattered across the west side of town. Businesses are what the area needs. I think values will really go up if the residents of those neighborhoods do not have to go to Hamburg or south Lexington for shopping/dinning/entertainment. A nice big road like this might attract them.
This is an exciting time to be in real estate. Things are changing so fast. Prices are increasing in some areas, stable in others. Tastes are shifting too. It is a lot to keep up with…….every new business, every new road that opens changes how people feel about a location.
Neighborhoods with good design
Some people just want a house. Some people want a house and a neighborhood. I don’t mean location when I say neighborhood. That has more to do with proximity to features. Neighborhood is a vibe thing. A feeling. Has to do with trees, the layout of the streets, etc. Think curvy streets and roads with landscaped medians. Some good examples are Hartland Parkway in Hartland, or Slashes in Ashland Park.
It is no surprise that neighborhoods with a good vibe are more desirable than neighborhoods that don’t. That is one reason the exact same house is worth more in a neighborhood like Chilesburg than it is in Willow Bend or Masterson.
I am more of vibe person. I really like neighborhoods that have some pretty features to see as you walk or drive through them. An element of design. So, here are a few that I can think of off the top of my head and why I like them:
- Hartland is probably the best thought out neighborhood in Lexington since Chevy Chase and Ashland Park. It has a landscaped median running through the whole neighborhood. All of the cul-de-sacs have landscaped islands in the middle.
- Chilesburg-Since it has so many creeks running into the reservoirs in Jacobson Park, the developer didn’t have much of a choice but to work around them. There are several ponds in the neighborhood, a walking trail with plank farm fencing around it, and some wooded greenspace areas such as the best one on Willman Way.
- Greenbrier-There is just something about seeing so much green as you drive through it. Then you pass the clubhouse and see the golf course.
- The Woods-I really like the elevation changes and meandering road that runs through the whole neighborhood. It is now old enough to have some amazing trees. You feel like you have left the heart of the city and are in a secret, private place. Lakewood is a lot like that too because Lakewood use to be on the edge of town.
- Chevy Chase and Ashland Park-no explanation needed.
Those are my favorites. I don’t think we will see anything like these neighborhoods in Lexington again. There just isn’t the space left. Other than a few areas in town, we are down to infill projects. Those often don’t have the space to do much more than clear the land and lay out the neighborhood in a way that maximizes the number of lots.
Picked my listing to buy sight-unseen…..WHY?
I’ve always told people the goal of a listing’s pictures and marketing remarks was to sell a showing, not to sell a house. LOL, looks like I have been a little wrong because I just had one of my listings sell to a buyer who has NEVER SEEN THE HOUSE.
The buyer is from out of town and only based his purchase decision on pictures and marketing remarks. I had plenty of professional pictures. Besides putting comments with each picture, this is what I said about the house:
” Ok, so I’m with the photographer getting pictures for this house, and you know what I’m thinking about? I’m thinking about how easy it would be to live here. This one isn’t just about good looks & move in ready condition. I can really see you living here & appreciating the seldom seen features that you would grow to appreciate more & more. Like what? Look at the kitchen. Count the cabinets. Not only a lot of them, but you’ve got drawers for big pots & sheet pans. Eating? Options are the island, the breakfast area or the dining room that offers a panoramic view of the whole first floor. Big Laundry room. HUGE bedroom upstairs that could really be used for anything….even an upstairs Family Room. The wide tiled hall between the garage & kitchen would be a great spot for cubbies. The driveway is flat & there are no houses behind you. You’re all the way back at the end of a Cul-de-sac. Listen. Silence because you back to a farm, but, you’re 5 minutes away from the by-pass.“
This house had been listed with another agent right before I got it. It is a very nice place, but like I usually do, I asked the sellers to make a few adjustments. We rearranged some furniture, cleared out a few things. The bathroom had stained wood cabinets and matching panels around the garden tub. The edges of the wood were a bit worn. Not bad…..unless you are trying to sell your house in a market where buyers think a house has to be perfect. Simple solution was to paint them white. What a huge difference it made. I think I told them to paint the bathroom a beachy blue color too, unless I am starting to confuse my listings! Any way, the bathroom and the whole house looked amazing once the seller got all the work done. (I think my next blog post might be about how the seller has as much to do with the success of selling their house as anything else. Even in the terrible market of the past, I could sell any house if the seller would take my advice on price and presentation.)
I am sure this buyer studied every house that looked interesting to him. I can’t help but think that the extra effort I spent to present the house and explain its unique features made it easier for him to make a decision. Don’t you feel sorry for the sellers whose houses were poorly presented? They might have been perfectly nice houses, but to a guy who was going to buy without seeing it, they didn’t stand a chance.
Want to know what LEXington buyers are doing??
The real estate scene in Lexington sure is changing. Guess it always has, but this years it seems to be doing it quicker.
What’s hot and what’s not has been pretty static around here for a long time. Other than Kenwick getting trendy and all the flopped new downtown condo projects, this town has always been about the middle of the road, safe and predictable neighborhoods in decent school districts. People who wanted older houses wanted in 40502 or the older neighborhoods on the south end of town that were inside New Circle. People who wanted newer homes looked around Man O War. There was always plenty of new construction going on all over town.
Now it seems that new construction has slowed down. You’d think since we are running out of room inside of Fayette County, that new construction would be on fire right now. Especially after all the slow years of the bad market. It did bounce back strong in 2013, but has slowed since. All the national news I read about it indicates the same is happening everywhere.
I am seeing more and more people wanting older houses. They are rejecting the cookie cutter neighborhoods. Many are considering neighborhoods on the north end of town.
All this is pretty interesting to me, both professionally and personally. I have to keep up with it so I can give my clients the good advice they deserve. I also like to think about why we are seeing this shift?
I think a lot of this has to do with shows like Property Brothers and sites like Houzz.com. People want a house with character more than ever now. After several years of a bad economy, people now feel safe to renovate their houses. I think people are spending more time at home due to being so connected online. It only makes sense that people want to create their own oasis to be in while they spend all their time connecting with the world through their phones.
I once had an out of town client tell me that the Lexington market is very broad but not deep. We tend to have the same 10 floor plans build by the same builder throughout all of Lexington. It is almost like 3 easy step: 1) Pick your floor plan. 2) Pick which part of town you want to be in. 3) Pick if you want that house to have been build in the 90s or 2000s. I had another client from New York tell me he wanted a contemporary or modern house. He didn’t get one because we have so few. People today are just not excited about living in a modern day Levittown. (Google that if you don’t know what I mean.)
Lexington doesn’t have the sprawl like a real city does. We keep adding people but we don’t expand the geographic boundaries of the town. That means more density, which means more traffic. People are wanting more than ever to be closer to amenities they frequently use. That is one reason the older neighborhoods are doing so well right now.
As prices have returned to 2005 levels but wages have not, you don’t get as much for your money. That is why we are seeing some people look on the north end of town. You get more for your money there. This is especially true for many first time buyers. An older house on the north end of town is a real bargain today. Also, the north end of Lexington is a great spot for younger buyers who want to be close to all the new spots along North Limestone.
Well, I’m over 600 words now. I could go on and on. Bottom line is that buyer tastes are shifting in this town and it is kind of exciting to me.
Your Lexington Kentucky Neighborhood Expert 