Big home remodeling projects may not be worth the investment

If you're considering a major home-renovation project, think long and hard about what you want to do and how much it will cost - especially if you plan to sell your house and think your improvements will boost the price enough that you'll cash in.

These days, it doesn't work that way, especially in a housing market like the Philadelphia region, with 13.9 months' worth of available homes, given the current pace of sales.

Each house for sale today is competing with 48,000 others. In October, only about 2,000 homes were sold.

"I advise painting - paint is cheap - and taking up old carpets if there is hardwood underneath, and a good, general cleaning," said Cheryl Miller, an agent at Long & Foster Real Estate's Blue Bell office. "Anything else isn't going to have any guarantee of return on investment."

Pricey items bought for personal enjoyment are more " 'lifestyle' choices - not investments in the property," Miller said. "Sometimes, the seller gets it, sometimes not."

As Prudential Fox & Roach associate broker Mark Wade sees it, "The two most important ingredients to getting top dollar is cleanliness and a decluttered look.

"Often, the emotional impact of the way a property shows is equal to, or more important than, the amenities," Wade said.

If a seller is making improvements, they have to be the right ones. Perhaps just new appliances or a new sink, said Ruth Feldman of Weichert Realtors/McCarthy Associates in Philadelphia.

"A new kitchen or bath with the wrong layout or amenities will hurt the sale," she said.

"If a new deck or finishing the basement will expand the space in a very small house, then that might make sense or be worth the money, even if [the sellers] don't see the exact dollar return, as it would make a big impact."

In a continuing climate of tight credit, getting the money to pay for home improvements is difficult, unless your pockets are very deep.

"The home-equity loans and lines of credit are just fancy names for a second mortgage, and that market is a bit tough," Philadelphia mortgage broker/Realtor Fred Glick said.

"Most banks are still going up to 80 percent loan-to-value, and I actually have one lender that will do 85 percent," he said. "But credit must be very, very good, and full income documentation is a must, along with a real appraisal that needs to be done, not just a drive-by."

The old fashioned home-improvement loan? Very hard to come by, Glick said.