Real Estate

can renovating a condo unit increase the sale price?

  • Last Updated:
  • Jun 26th, 2016 5:44 pm
Tags:
None
[OP]
Penalty Box
User avatar
Feb 21, 2013
344 posts
41 upvotes
Yukon

can renovating a condo unit increase the sale price?

if you were to add $20,000 of improvements into a condo unit, will you be able to sell that condo for a higher price and make up for the cost of the improvements? the problem is that your condo unit price is closely tied to the guy above and below you. so does renovating a condo make sense?
10 replies
Deal Guru
User avatar
Mar 23, 2008
12214 posts
8626 upvotes
Edmonton
No, most likely it will drop the price of your unit...

Of course your unit will be worth more, as long as it's done properly. New granite countertops are better than scratched up and abused laminate countertops. Hardwood floors will attract more buyers than laminate.

The real question is whether the return is worth the money invested. If you have to pay someone to come in and do the work, I suspect you'll have a negative return on your investment. If you spend 30k on a new kitchen, you might only get back 20k or 25k of that.

At least, that's the way a normal market goes. Who knows about TO...

ANd yes, the value of your unit is partially driven by things outside your immediate control, like the location, your condo strata, your neighbors... But things like the state of YOUR unit are in your control, so you have to decide what to do about that. Sinking a 50k kitchen into a rat hole would never be worthwhile, though...

C
Deal Expert
User avatar
Aug 18, 2005
20130 posts
4670 upvotes
Burlington-Hamilton
hipster wrote: if you were to add $20,000 of improvements into a condo unit, will you be able to sell that condo for a higher price and make up for the cost of the improvements? the problem is that your condo unit price is closely tied to the guy above and below you. so does renovating a condo make sense?
No. If someone wants to spend $20K more, they will get a bigger unit, not one that's more upgraded. In a highrise condo, do the minimum to make it look good and fix any actual problems.

Changing carpet over to engineered hardwood could be a real benefit because it is a functional improvement to people with allergies.
Upgrades that add more storage will also be attractive to buyers due to cramped condo space.

But I would not go in and spend money on quartz counters, new appliances, fancy backsplashes, etc
- casual gastronomist -
Deal Addict
Aug 10, 2013
2257 posts
574 upvotes
Toronto
Not really and huge risk, condos are terrible for trying to flip and make profit.
Sr. Member
May 3, 2013
644 posts
207 upvotes
Toronto
hipster wrote: if you were to add $20,000 of improvements into a condo unit, will you be able to sell that condo for a higher price and make up for the cost of the improvements? the problem is that your condo unit price is closely tied to the guy above and below you. so does renovating a condo make sense?
It really depends. You're right in that the price is somewhat restricted with comparable units in the same building. At the same time, other units may have renovated or may be dated. You may be renovating just to be able to sell it for what your neighbor sold it for. Also, it depends on your condo unit, location, and what you're spending the $20K of reno on.
Deal Guru
User avatar
Mar 31, 2008
11857 posts
2288 upvotes
Toronto
It'll just stop your condo from falling in price. There might be some gain, but not nearly enough to offset the costs.
Deal Addict
May 3, 2006
2505 posts
40 upvotes
Milton
Jucius Maximus wrote: No. If someone wants to spend $20K more, they will get a bigger unit, not one that's more upgraded. In a highrise condo, do the minimum to make it look good and fix any actual problems.

Changing carpet over to engineered hardwood could be a real benefit because it is a functional improvement to people with allergies.
Upgrades that add more storage will also be attractive to buyers due to cramped condo space.

But I would not go in and spend money on quartz counters, new appliances, fancy backsplashes, etc
I disagree, condo owners don't buy bigger when they can "afford" it because higher condo fees, more space to clean, etc -- condo buyers buy exactly the size they want, and often times will spend more money to get a completely turn-key unit that has everything done.
Your source for training, nutrition, supplement advice!
Deal Fanatic
User avatar
Sep 8, 2007
9018 posts
10319 upvotes
Way Out of GTA
Better yet if you could take that $20k and turn your condo into this sterile lifeless environment why wouldn't you? You can pretend you live in the Apple Store and rent it out for surgeries when you are out? Win win?

Image
Member
Sep 1, 2013
403 posts
96 upvotes
It works when you upgrade the entire multifamily structure. For example, an apartment building owner spends on capex to re-rate the building from, say, B to B+ or A-. Your individual condo will be priced by your building's rating much more than on its own. You don't want to price yourself out of the market for that building with capex.

On the flip side, if you buy a rundown unit in a highly-rated building (usually unlikely), the capex can add net value.
Deal Expert
Oct 6, 2005
16599 posts
2314 upvotes
hipster wrote: so does renovating a condo make sense?
Of course, a fresh coat of paint, clean grouts, clean kitchen can do wonders for your price. It's all about perception.

Jucius Maximus wrote: No. If someone wants to spend $20K more, they will get a bigger unit, not one that's more upgraded.
Some people are very visual - they don't understand the concept of upgrading/renovating. You capitalize on these suckers.

Even still, for the informed buyer, they would probably prefer a clean and modern unit over a old and dingy one all things considered.
Deal Expert
Feb 29, 2008
26675 posts
3572 upvotes
Montreal
cartfan123 wrote: Better yet if you could take that $20k and turn your condo into this sterile lifeless environment why wouldn't you? You can pretend you live in the Apple Store and rent it out for surgeries when you are out? Win win?

Image
I've seen that same monstrosity all in black.

Top