Top markets for affordable renovated housing inventory

Despite the rapidly deteriorating affordability, there is some hope for homebuyers in the form of renovated homes: properties that have been rehabbed into move-in ready condition after being purchased at auction.

HousingWire Magazine: December 2021/ January 2022

AS WE ENTER A NEW YEAR, let’s look at some of the events that we can look forward to in 2022. But what about what’s next for the housing industry?

Mortgage Tech Virtual Demo Day

Tune in to our live Virtual Demo Day on December 1st at 10am CT to experience demos from the most innovative tech companies in the Servicing, Audit and Post-Close space.

Logan Mohtashami on Omicron and pending home sales

In this episode of HousingWire Daily, Logan Mohtashami discusses how the new COVID variant, Omicron, will impact inflation and whether or not it will send mortgage rates lower.

Real Estate

Realtors: Solar panels boost home values best in energy-rich Texas

Forget fixing up the bathroom

Forget adding a new addition, homeowners.

As it turns out, the best remodeling idea, at least in Texas is for homeowners to put in solar panels, according to the Texas Remodel Valuation Report released by the Texas Association of Realtors.

This report studies recoup costs for 30 remodeling projects in the West South Central U.S., Austin, Dallas, El Paso, McAllen and San Antonio. And, according to the survey respondents, green energy ideas boost the value of the home the most.

“A growing number of Texas homebuyers are opting to purchase lower-priced homes that can be remodeled to suit their exact needs or make the home more energy efficient,” said Leslie Smith, Texas Association of Realtors chairman. “More and more Texas home sellers, too, are seeing the value in investing in a few, strategically chosen projects before listing to sell their home faster and potentially at a higher price.”

A study done by The Appraisal Journal shows that homes with solar panels are sold at a premium. The average premium for their study area of six states was $14,329. 

The top home remodeling projects improved the home's curb appeal or energy efficiency. Also among the top five was fiberglass attic insulation, which recouped at least 163.4% of the cost. Manufactured stone veneer projects also had high returns at 157.9% of project costs.

To be fair, most remodeling projects provide returns, with some recouping at least 100% of the costs, but this is not a given.

Houston, McAllen and El Paso had the highest annual profitability growth for remodeling projects. On the other hand, profitability declined slightly on projects in Austin, San Antonio and Dallas.

Unlike other years, projects to maximize the home’s square footage showed very little profitability, with owners making as little as 25.5% returns.

“There are many factors that go into whether a remodeling project is a good fit for a home in addition to impact on resale value, such as the homeowner’s expected tenure in the house and, for energy-efficient upgrades, how long it will take the project to pay for itself in cost savings,” Smith said. 

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