By Haripal Pannu

Generally speaking, real estate is one of the safest investments you can make if you do your homework. Rather than wait for the surrounding neighbourhood to appreciate in value, many investors force appreciation of their properties in a number of ways.

Here are a few tactics for forcing appreciation of your property.



Give the property a deep cleaning:

A dingy, crowded interior will knock thousands of dollars off if you’re showing a property to potential buyers. Get rid of bulky furniture and protruding cabinets to begin with. After that, have a professional cleaning company detail the property by scouring walls and woodwork.

Refresh the paint jobs:

Nothing makes an older house look brand new like fresh paint. Interior walls benefit greatly from paints that reflect light in any given room. New exterior paint increases the appreciation of your property if you choose the right primary and trim hues.

Replace carpets with new flooring:

Most homeowners prefer hard flooring over carpet due to its ease of maintenance and esthetic appeal. Oak or maple hardwood flooring is preferable if you can afford it. Vinyl plank flooring has become an increasingly popular option for kitchens and bathrooms. Laminate flooring is another option and is less expensive compared to hardwood.

Update exteriors and landscaping:

Curb appeal can add or subtract thousands from a home’s value. Apply a fresh coat of asphalt or a layer of gravel to the driveway. Reseed the lawn and plant a few shrubs to round out the grounds. Hanging flower baskets and flower pots makes the property look appealing.

Renovate kitchens and bathrooms:

Remodeling kitchens and bathrooms is the easiest way to force real estate appreciation immediately. Adding new backsplashes and hood vents in the kitchen is a great way to start. Installing energy-efficient appliances is another option. Granite or quartz countertops in either room always boosts home value.

Repurpose an existing space:

Every property has a room that can be retrofitted to add value without costing a lot of time or money. For instance, you could turn a spacious closet into an office. Likewise, a portion of a basement can be turned into a recreation room.

Open up floor and wall layouts:

Older homes in particular can benefit from open floor plans that allow for better natural lighting and ease of navigation. Just about any partition wall can be removed without impacting the structural integrity of the building. Widening interior openings will make the house seem less constricted.

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5 COMMENTS

  1. Yes that is exactly what house flippers look for. A property in need of updating in an attempt to increase the value. If a property is already updated there is little chance of “Forcing Appreciation” by changing the colour of a room or turning a walk-in closet into an office. Appreciation in value also depends on market conditions. I have seen a number of properties that were purchased with the intention of flipping and they currently are not selling. Unless you were an active agent in 1989 then you really have no experience in what a declining market looks like.

    • David

      I believe the term “flipping” is an anomaly and highly misunderstood. Yes. Timing is everything.

      I came into the industry in 1980. The “R” word was everywhere and houses heated by oil took nearly two years to sell. And then there was the urea scandals, and the not so user friendly interest rates 18-23%. Vendor buy-downs, and VTB’s.

      Sometimes it’s best if we don’t know what we don’t know. I earned 75k my end on a 50:50 split the first six or seven months in the business. I had no idea why, and truly thought everyone was doing what I was doing. I didn’t know any better. Commission cutting had never been heard of.

      Investors first need to be good at basic arithmetic. And it’s simply surprising how many aren’t. In order to “flip” a property and make it worthwhile the buyer as owner has to not just recover his investment, but his improvement costs, his basic carrying costs if he bought using borrowed money, the general costs that every property has: heat, hydro, water and property tax.

      Then there’s the formidable LTT he had to pay at closing and will want to recover. There would need to be a sizeable new sale price differentiation of likely well over 20-30% price increase, for the flipper just to break even. Homeownership is not often a liquid asset with a high, fast ROI.

      As time went on, it wasn’t long before my market share had grown surprisingly in spite of unexplainable obstacles that appeared in the path. In less than six years I was the number one corp rep in the whole large geographical Region. And we were smack in the middle of a recession. Who knew? Certainly I didn’t. I just kept on doing what I had done since day one.

      I certainly wasn’t any smarter than others in the same market. So what was this/is this phenomena called “recession?”

      I got through more than one recession. But I didn’t seem to know we were in one. Of course I confess. I am a news junkie. I read the headlines to see if anything is worth reading further. So it wasn’t difficult to see. The world of finance was in a mess. And I could and did borrow money at prime minus 60 points.

      Then came the “biggie.” It was 1991 and I had ten years of practice behind me and had long gone been blessed with a 24% market share (teams were unheard of, and private secretaries were verboten in capital letters), when I opened my own boutique agency; another anomaly.

      All I heard repeatedly was: what’s wrong with your head; don’t you know we are in a recession? I give you six weeks; I give you three months; I give you six months; you’ll never make it to year one.

      I maintained my 24% marketshare in my trading area, all through the so-called recession(s), until a family disaster took place, followed by a massive cancer issue. So I elected to put things on hold. Now age 77 in a few weeks.

      But my point is that flipping is an absolute uncontrollable “adventure.”
      I had one family who had bought and sold several properties during the late 80’s recession and I made money for them every time and we’re talking 500-800k properties. One had a six month “flip” and made 80k ROI. They listened carefully when I told them what absolutely “not” to do. And we were still in that recession.

      I never worked much with investors but when I did, I was very strict, and if they weren’t prepared to listen, I said those now infamous Trump words, before we ever went looking at properties. (Bye, bye!!!)

      I simply refused to work with unreasonable people. If they knew so much better than I did, go get yourself used and abused by some other agent. I wanted to keep my impeccable reputation. I wasn’t prepared to invest “me” as part of their wish-list.

      So, back to flipping. An investor definitely needs to understand the “kiss” principle above all else, tied closely to Grade 7 math.

      There’s still so many of the mostly American-lead “investment clubs and courses” out there and a taker born every day. First chapter in any of those books needs to be: listen to the “local” neighbourhood expert agent and be prepared to pay him well, because he will earn every penny (his and yours).

      Carolyne L 🍁

  2. David, if there is exactly 2 houses on sale and on same street and one house did nothing special and other house did as per Harry’s tips which one would fetch better price??? Not a hard guess!!!!

  3. I believe this is called house flipping associated with Home Staging. For starters one can only increase the value of a property in a neighbourhood if the said property is currently in bad condition. If the property is already in great condition and looks like it came out of a better homes and gardens magazine how can you “force any appreciation’? Secondly if the property has a terrible location then spending thousands of dollars to “force appreciation” will be a waste of money. To state what does and does not appeal to Buyer’s is pure speculation and there is no empirical evidence or data to support such claims. And turning a closet into an office or extra living space is just a crazy idea.

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