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4 Ways to Make the Best ROI on Your Home Sale

By Aly Yale – Nov 7, 2021 at 5:01AM

Key Points

  • You can't control the market, but there are things you can do to make your home more marketable -- and possibly more profitable.
  • Making smart improvements, staging, and timing your sale right can all increase your ROI.
  • Strategic pricing may also help your home fetch higher returns.

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Want to make more from selling your house? These four strategies can help.

Making a solid return on investment (ROI) is critical when selling your home. After all, a home is an investment. It should grow in value, helping you build wealth and improve your financial station over time.

Do you want to improve your home's value and ensure you get a decent-sized return on your investment down the line? Here are four ways to do it.

family standing in front of a house with for sale sign

Image source: Getty Images.

1. Time it right

Your ROI will depend so much on the market -- both at the time you buy and the time you sell.

Generally speaking, you want to buy low and sell high to maximize your proceeds. While it's impossible to determine exactly when you're at the absolute highs and lows, you can watch the market and act when things lean in your favor. Is demand up? Are prices rising? Are mortgage rates low? An experienced local real estate agent can usually give you the latest market conditions in your area if you're not sure.

You can also follow some general guidelines. Historically, demand is slowest in the wintertime, meaning you'll find the least competition and the best deals during this part of the year. Conversely, things heat up in spring and summer, making it a better time to sell once you're ready.

2. Be choosy about improvements

Making a few home upgrades can certainly improve your home's value and increase your potential ROI. But be careful: Not all home improvements have equal benefit. In fact, some (ahem, pools) might even make your home less marketable due to the upkeep and hassle they come with.

If you're looking to update your home to increase its value, look to Remodeling's Cost vs. Value Report for guidance. It breaks down which projects deliver the best ROIs, as well as how much resale value you can expect with some of the more common remodels and updates.

3. Stage it

Staging your home (or even just a room or two) can help you command a much higher price point when you're ready to sell. Just look at the recent Profile of Home Staging Report from the National Association of Realtors. According to the report, 23% of buyer's agents say staging increases a home's dollar value from 1% to 5%. Another 25% of agents say it means at least 6% to 20% more in value. 

If you don't have the budget for a full-on staging, focusing on just one or two rooms can still help. According to that same report, buyers find the living room, master bedroom, and kitchen most important -- so put your efforts there for the most impact.

4. Price it right

It sounds crazy, but if you really want to increase the money you get from your home, you may want to think about underpricing it -- at least slightly. Doing so can both increase the marketability of your home and the competition surrounding it.

Think of it this way: Say every house in your neighborhood is going for $400,000. If you list yours slightly under, say at $395,000, you'll probably get some serious attention for it -- and maybe even a bidding war. This could mean $20,000, $30,000, or even $50,000 more, depending on your market and the demand out there.

The bottom line

Securing a good return on your home investment isn't difficult -- it just requires some planning and forethought. Are you thinking of selling your home in the near future? Make sure you talk to an on-the-ground professional in your area who can give you the rundown. You'll want to time your sale as strategically as possible to maximize returns.

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