Can hardwood flooring improve the resale value of your home?
Absolutely! Hardwood floors can help sell your home faster and for more money. Why? Because hardwood flooring is the preferred flooring choice and it improves the value of your home. And, if you don’t believe me, ask any realtor, and they’ll tell you the same thing.
Tax benefits of hardwood flooring
In addition, you have some tax benefits when you add hardwood flooring to your home. Hardwood floors are considered a capital improvement, and therefore the sales tax is lower (it may vary by state, but most states charge tax on the material and not the labor for hardwood flooring). For carpet, you have to pay tax on the full amount. So, short term, you have an added benefit.
Second, there is a potential long term benefit on your taxes. Because hardwood flooring is a capital improvement project, when you eventually sell your house, you MAY be able to reduce your capital gains tax. This is more likely to happen if you own your house for a long period of time so that you’ve acquired a larger gain. (Please note that I’m not a CPA and you should consult a tax consultant for your particular situation).
Leverage your hardwood floors to help sell your house
If you have hardwood flooring (rather than carpet), your house will generally sell for a higher value and sell faster. Any real estate agent will confirm this…after all, this is what buyers are looking for (especially Millenials and Gen X’ers
I work with a lot of real estate agents, stagers, home sellers and home buyers. And, the preference is consistent. And, it’s especially apparent when I’m working with new home buyers…they are almost always ripping up carpet and refinishing the hardwood underneath, as well as adding hardwood to rooms where it’s missing.
It is rare for carpet to remain in place with a new home buyer…they will almost always rip it up….either refinish the wood underneath, replace it with wood, or if it is a bedroom, some will replace it with new carpet. If a room has been “lived” in, the carpet will be removed VERY quickly (usually by the day after closing). The new owners are concerned about the germs, smells/odors from previous owners, not to mention that they rarely have the same taste in carpet style or color. There are usually furniture indentations as well as areas where the carpet is stained or discolored from light (and it becomes very apparent after the sellers’ furniture has been moved out).
So, when a buyer sees carpet, they see a lower value and higher costs that they will need to pay to replace it. This can reduce the offer on your home as well as increase your time on market.
So, if you are selling your home, what should you do/what shouldn’t you do with your flooring?
These are some general recommendations. Every house/community is different, as is the ability to spend to fix up your home. I recommend that you consult your real estate agent and/or stager for advice. I understand that when you are selling your house, you want to spend the least amount of money for the highest return. So, in that context, here are my recommendations:
1. If you have hardwood underneath the carpet, rip up the carpet and refinish the hardwood. This is often one of the smartest investments you can make to sell your house. It will make a HUGE difference and is well worth the investment. It will make your home look nicer, often it will make it look larger and it will improve the value. If funding is limited or if this is too inconvenient to do, then consider just refinishing the wood for some of the rooms to at least show that you have hardwood and what it looks like.
Do NOT replace with new carpet. This will cost you more and will be less appealing to home buyers.
2. If you have hardwood that is badly scratched up, sand and refinish it. If your hardwood isn’t in good condition, it will usually be worth it to sand and refinish. This will make your hardwood look good as new and show your home at its best.
Alternatively, if you don’t refinish the floors, your house won’t show as well and the new owners will need to refinish the floors…and they will factor this cost into the purchase price. (And, in my area, refinishing hardwood is not terribly expensive, and most people think it costs more than it does…so you can either give them an allowance, allow them to guestimate the cost (which will be higher) or pay for it upfront. I’d recommend (when you can), to refinish it before your house goes on the market…since you will pay for it one way or another, and it makes sense (in my opinion), to refinish them and have your house look its best so it will sell faster. (And, generally selling faster means it will net a higher price).
Should you ADD hardwood floors to your home, if you’re selling it?
Well this depends on your neighborhood and how your house compares to others in the area. Usually, hardwood will improve the value of your home and can often be worth it. But, there are also cases, especially in lower end neighborhoods or apartments where you may “over improve” your home and you may not be able to recoup the investment (e.g. if your target buyer is not going to spend more than a certain amount to buy your home give the area, schools, stage of life, etc).
In general, in Westchester county, in mid to higher end homes, you will usually get back your investment, and then some. But, I would advise you to consult your real estate agent and/or home stager to get their opinion. They know the market.
Of course this decision also depends on your budget and how much you can invest to prepare your house for the market. Also bear in mind that hardwood flooring is a capital improvement, so investing in hardwood floors can be a tax benefit as well when you sell your house (it could reduce your capital gains pending on your purchase and selling price.)
What color should you refinish your hardwood floors if you are selling your home?
This does depend on the style of the house, but generally when most people in my area are looking to sell their homes, I usually recommend going natural (the lightest option) as this is a) very neutral, b) makes your space look larger and c) generally costs less than doing a stain.
However, there are exceptions to this. First, in some older homes (e.g. tudors), light colors just don’t look right for the style. In those homes often a dark brown (e.g dark walnut) just looks better and it’s what buyers would expect in that type of home. (And, dark is super popular now).
Also, if your floors are really old/beaten up and/or have some water stains, you may need to select a darker stain to cover the imperfections. Whatever color you are doing, I would try to avoid stains w/ red tones as these are polarizing – some customers love, others hate. Brown tones or natural is more neutral and widely appealing, and that’s what you want when you are selling your home.
If your budget is limited, I would recommend the following:
- If you can’t afford to do “everything,” you may want to pay a professional to refinish the floors while you paint the walls and save money here.
- If you can’t refinish all the floors, consider doing some of them so that buyers can see what the floors look like.
- If you can’t afford to pay anyone to refinish the floors, at least rip up the carpets so that buyers can see there is wood underneath. (You can even do this yourself for free…and you’ve already reduced the costs that the buyer needs to invest later.
Other useful articles:
- What types of flooring provide the best ROI, if you’re selling your home?
- I have hardwood underneath my carpet – should I refinish the hardwood or recarpet?
- 2017 Hardwood flooring trends
- Which stain colors are most popular?
- Ebook: What to look out for if you’re buying a new home with hardwood floors or want to add hardwood flooring to a new home you’re buying
- How to reduce and prevent scratches in hardwood floors
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For more info, check out my Ebook – Discover the 6 Secrets to Refinishing Hardwood floors.
Do Hardwood Floors increase a home’s value?