I recently should my second home in 3 years (I don’t actually own multiple homes. I just move a lot). We owned this home for just over two years but have done a ton of home improvements, both DIY projects and professional installers. When we moved in, our realtor advised us that as we make changes to the home to save our receipts and keep track of all the updates if we make any. We agreed that while owning our home, we would keep track of home improvements in detail. We came to realize when selling our home, this was our best argument for selling our home for the price we sold it at. We stuck to our guns and sold full price.
So, the answer is yes, try to always keep track of our home improvements. Here is how I organized the home list of improvements and used it to sell our home at a much higher price two years later.
Understand Your Neighborhood and Make the Right Home Improvements to Increase Value
Before you start going off and doing home improvements, take a good look at the homes selling in your new neighborhood. When we bought our home, we bought at a good value for the neighborhood. Home prices were on the rise and the homes selling had nice above-average features. Though, the features were not high-end luxury. This told us that if we plan to sell in the next 5-10 years, we should not go cheap on improvements but not go over the top because we may not get the return on the investment of the home improvements.
Save All Your Receipts for Improvements
From floor installation to the light switch you changed out yourself, save the receipt in a folder of some sort. The kept my wife and I honest with our estimate of investment but also track even the small home updates that enhance the home. Sometimes people forget about the doorknobs they replace. Those doorknobs add up if you replace 10 or 15 of them at $30-$40 a doorknob. Knobs on cabinets and vanities alone, we spent $200 and installed them ourselves. Those small improvements add up to a large amount over time and we took advantage of that!
Target Home Improvements that are Low Hanging Fruit
Once we moved into our home, we noticed certain things in the home that needed to be improved or repaired. We immediately targeted low-hanging fruit improvements, the DIY improvements that were inexpensive and could do quickly. If you don’t see any, check out my 7 inexpensive home improvements you could do yourself. Not only do these add value to our home, they provide us a sense of ownership and gratification doing it ourselves.
Take Before & After Pictures of Each Project
This is my favorite part. I keep a Google Photos album I share with my wife. We have pictures from the listing before we purchased the home, the home inspection, and during move in. When we had big projects going on that seemed to take forever, we sometimes forgot how far the home has come. By taking pictures, you can document visually what improvements you have done and display them when you sell the home.
Create a Spreadsheet for Tracking Investment in the Home
Creating a spreadsheet is the most important part of tracking home improvements. My wife and I use Google Sheets to track this. This sheet is the focal point for driving the selling price of the home. In the spreadsheet, we kept created tabs for the following
- All major projects
- Investment summary by room
- Detailed list of all receipts
Each tab should have dates, totals, and contractors listed if you had someone do it. Here is a template of the spreadsheet we used.
In the end, it doesn’t matter how you track these things, just remember to have proof of your home improvements. This is not only helpful in selling a home, but also for the home inspection and appraisal of the home. It’s also important to enjoy the improvements you’ve made. After all, it’s for you. Just keep in mind that re-sale is also important in the decisions you make!
