As printed in Smart Money Money Magazine (March 3, 2003):
You've done everything humanly possible to boost the value of your home: put a trendy island in the kitchen, laid fresh carpeting to replace that dusty '70s shag, constructed a spa-quality bathroom bigger than most studio apartments. And now you're scratching your head, wondering how to jack up your resale price even more.
Look outside, silly.
After all, when well-heeled buyers pull up to your home, it's not the luxury faucets or the gorgeous granite counter they see first. It's the landscaping. And if your lawn is patchy, your trees are on their deathbed and your plants are a poor excuse for flora, it isn't going to matter what kind of magic you've worked indoors. Those buyers may keep on driving. "When people ask me how they can get strong interest in their property, I always tell them to fix up their landscaping,' says Walt McDonald, president-elect of the National Association of Realtors. "If a homeowner is reluctant to do it, I tell them they won't get top dollar."
That's the payoff. You will not only attract more buyers and get a quicker sale but also probably get a welcome boost in your sale price. "If you spend 5% of the value of your home on landscaping, and do it wisely, you might get 150% or more of your money back," says Massachusetts Realtor Gill Woods. And sometimes that number can go even higher. If your home's landscaping is on the low end for the area and you're putting it on par with your neighbors, you could be looking at a 15% rise.
Just ask Chuck Mitton of Cherry Hills Village, Colo. He and wife Jean went to town on the nondescript backyard of their ranch home a few years ago. A tangled mass of overgrown plants became a three-level wonderland, complete with ponds, waterfalls, dwarf conifer trees and fresh flowerbeds with roses and azaleas. Oh, and don't forget the new "hardscapes," such as a winding brick walkway, a backyard hot tub, and a barbecue pit and dining area, where the couple eat "almost every day" during warm weather. "If you're going to do some landscaping, I'd say do quite a bit," suggests the semiretired bookkeeper and investor, who spent $60,000 on his additions. "Then you can enjoy it yourself and the value of your home will go up too."
The proof: When Mitton refinanced in 2001, the originally $250,000 home was reappraised at $750,000 roughly $150,000 to $200,000 of which he attributes to the landscaping. "Landscapes take time to mature," says the 59-year-old, "but I'd say people might be able to make 200% of whatever they put in."
Plus, it can be fun. Gardening is one of the most popular hobbies in America: In 2001 homeowners spent $37.7 billion taking care of their yards, up from $22.5 billion five years earlier, according to the National Gardening Association. While the increase has been fueled by a maturing boomer population and a spike in homebuying, people are also clueing in to the fact that it can add dollars to their home's value. And academic studies are proving it. A study by Clemson University and the University of Michigan found that consumers value a landscaped home up to 11.3% higher than its base price. And one Quebec survey found that hedges raised property values by 3.6%, a landscaped curb by 4.4% and a landscaped patio by a staggering 12.4%.
In fact, you're going to have to do what you can to make your property stand out, now that the housing market is cooling. Most real estate watchers, such as home-price research firm Fiserv CSW, are predicting slower price increases in the coming years; other market bears are warning of a steep drop-off. "Six months ago anything on the market had people clamoring," says Woods. "In a cooling market, it's going to be more difficult to get a buyer into a piece of property. The key thing now is 'curb appeal.'"
Such appeal isn't just about your lawn, trees, shrubs and flowering plants, though these days you'll want to consider popular hardscapes such as gorgeous walkways, sweeping arches, full kitchen areas and barbecue pits, elongated patios and decks, elaborate backyard retreats and gazebos, and more. The stakes have been raised.
To put it into perspective: For a $500,000 home, on which you spend $25,000 to spruce it up, even a modest gain of 7.5% would put $12,500 of straight profit in your pocket. Though the result a perfect yard may look beautifully simple, a thousand factors contribute to it, from dealing with contractors and knowing what to plant to hiring landscape architects and designers, and making sure your costs don't spiral out of control. To sort out the complexities, we've broken down the four big trends du jour: curb appeal, the year-round yard, the sanctuary and bringing the indoors outdoors. And we've got insider tips for every stage of the process.
Reference: 'Fertile Ground' by Chris Taylor in SmartMoney Magazine (March 3, 2003)
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