Will A New Roof Increase Your Home’s Value?
Selling a house is a significant decision. One of the key considerations for homeowners is whether to invest in significant renovations like a roof replacement before putting their property on the market. But does a roof replacement increase your home’s value when it’s time to sell?
Rescue My Roof has been an educator in the roofing industry for over a decade, helping homeowners get the most out of their homes. Today, we’ll break down whether or not a roof replacement positively impacts your home’s marketability.
Ultimately, you’ll walk away knowing whether or not upgrading your home before listing is the right step for you.
Does A New Roof Increase A Home’s Value?
The short answer is “yes.” Remodeling’s 2023 Cost Versus Value Report says a homeowner can expect to get 61% of the cost of a new asphalt roof back in home value.
The long answer is “yes, but…” You probably can’t match dollar for dollar. The National Association of Realtors (NAR) states 33% of Realtors suggested sellers add new roofing before attempting to sell, and the organization argues the recovered cost is equal to the spent cost.
While a roof replacement has a pretty high return on investment (ROI) compared to other home projects, it doesn’t mean replacing your roof justifies you marking up your home’s price by thousands of dollars.
Pricing a home is more complicated than just adding on what you’ve investment to your home’s starting value – especially when it comes to roof replacement. This is because your house is supposed to have a roof.
When a buyer makes an offer, they assume the roof is there and functioning properly. It’s tied to the price tag, not an add-on. Additionally, keeping your roof in good condition is a part of average home maintenance. So, a seller shouldn’t expect buyer’s to pay extra for a roof, even if it is newer.
If your roof is old or leaking and needs to be replaced, go for a mid-range roof. Don’t spend high dollar amounts you won’t get back or do the bare minimum. Buyers can see if you did the least possible in terms of upgrading, and they won’t want to pay for the upscale. Midrange is your best bet for high return on investment.
Should You Replace Your Roof Before Selling? (8 Things to Consider)
Before selling your home, a new roof could be a significant selling point – or a downside for new homeowners.
Here are eight things you should consider before investing in your home.
1. Roof Condition
The condition of your roof is critical when selling your home.
If your roof is in a state of disrepair with multiple leaks, damaged shingles, or structural issues, it’s advisable to replace it before selling. A damaged roof can be a significant red flag for potential buyers, and it could deter them from making an offer or reducing the price they’re willing to pay.
2. Market Conditions
Consider the current real estate market conditions in your area. In a competitive seller’s market where demand is high, and inventory is low, you may have more room to negotiate and sell your home as-is.
However, in a buyer’s market, where many properties are available, having a new roof can make your home stand out and justify a higher asking price.
3. Home Value
Think about your home’s overall value. If your property is in a higher-end neighborhood, buyers may have higher expectations regarding the home’s condition, including the roof.
In such cases, investing in a new roof can be a smart move to ensure that your home aligns with the expectations of potential buyers.
4. Inspection and Appraisal
Most buyers will conduct a home inspection as part of the purchasing process. If the inspector identifies roof issues, it can lead to complications during negotiations or cause the deal to fall through.
A pre-listing inspection can help you identify any roofing problems in advance, allowing you to address them proactively. If your roof has several critical issues, it’s best to address them before selling your home to get the highest offer possible.
5. Pricing Strategy
Consider your pricing strategy. If you’re determined to sell your home quickly and are willing to accept a lower price, you may choose not to replace the roof. However, if you want to maximize your home’s value and are prepared to wait for the right buyer, investing in a new roof can be a strategic move.
6. Return on Investment (ROI)
Evaluate the potential return on investment for a roof replacement. While a new roof can increase your home’s value, you may not recoup the entire replacement cost in the sale price.
Research the average ROI for roof replacements in your area to make an informed decision.
7. Buyer Preferences
Consider the preferences of your target buyer demographic. Some buyers may be looking for fixer-upper opportunities and may be able to handle a roof needing repair. Others may prefer a move-in-ready home and be willing to pay a premium for it.
Consult with your real estate agent to see what other buyers in your area are looking for. This can give you insight and help you determine whether or not to invest.
8. Transferable Warranties
A transferable roof warranty is a type of warranty that can be passed on from the original homeowner to subsequent property owners. This means that if it turns out that your property isn’t your forever home and you decide to sell, the warranty will transfer to the next owners.
If you replace your roof before selling, investing in a transferable warranty is best so the new homeowners can receive the benefits. They can expect benefits like increased property value, long-term protection, and minimized negotiations.
Replacing Your Roof
The decision to replace your roof before selling your house is not one-size-fits-all and should be based on a careful assessment of your specific circumstances.
If your roof is in poor condition, it’s generally advisable to replace it to avoid complications during the selling process. However, in other situations, market conditions and your goals as a seller may influence your decision. Consulting with a real estate agent and getting a professional inspection can help you make an informed choice that aligns with your financial and timing considerations.
If you’ve decided to replace your roof, read “How Much Should You Spend On A New Roof” and “How Hard is it to Find a Roofing Contractor” to learn more.
Are you looking for a roofing contractor in southeastern Wisconsin? Rescue My Roof is here to help. Contact us today to get a free estimate.