Profitable Pre-Sale Home Renovation in Silicon Valley

It seems like one of the perennial questions about the sale of real estate is what pre-sale fix-ups you might want to do before putting your home on the market.

I talk to a lot of people about this, and the conversation usually begins by homeowners saying they want to sell their homes as-is. “As-is” means different things to different people: to me, it is a term on the contract which specifies that the the seller will not be required to do any repairs, or issue credits or a price reduction in lieu of repairs, unless otherwise stipulated in the purchase contract.

But most sellers take “I’m selling my home as-is” to mean that they won’t be doing any work on their home before putting it up on the market.

The funny thing is though that very soon after they make this assertion, they’ll say things like, “But I do want to paint it before we begin showing it,” or “I’m going to replace the broken oven” or “We’re going to take down the pergola in the back yard…” and, before you know it, they’ve come up with a lengthy list of deferred home improvement projects they want to take care of before they put their home up for sale.

Sellers are looking for me to guide them as to what home improvement projects actually make sense, and which will be a complete waste of time and money. I routinely tell sellers what I know to be true: it is the low-hanging fruit, those quick-and-easy things like cleaning and decluttering and landscaping and burnishing the curb-appeal that pay the biggest, and surest, dividends when it comes to selling a home.

But what about those bigger, more expensive projects – like doing a full or partial kitchen and bath remodel? Changing out the flooring? Redoing the patio in the back yard? Is it possible to do these larger, more-expensive projects and add value to the property comfortably (and reliably) in excess of the project cost?

The research is pretty clear on this: no, you can’t. According to the famous Journal of Light Construction “Cost vs. Value” report, and the National Association of REALTORs Remodeling Impact Report, there are almost no home renovation projects that yield a positive return on the investment.

If that’s the case, why does anyone ever even bother?

Well, for one, they watch too much HGTV.

For two, some people are actually able to make a substantial return on pre-sale home renovation projects. But it’s true, a lot of pre-sale renovation work just doesn’t pencil out, and could end up costing you tens of thousands of wasted dollars.

Because despite what those well-known studies show, it is possible to make a positive return on these pre-sale renovation projects. It depends on the home, the market, and if the renovations that are done can be done affordably – not too cheaply so everyone knows it’s just lipstick on a pig, but without spending more money than buyers for a home in that neighborhood would pay for.

In this week’s video on my YouTube channel, I give an example of the median home in San Jose sold in 2024, which did have significant pre-sale renovations. It wasn’t my listing, so I’m just making a series of educated guesses here, but I think I make a pretty convincing case how the sellers were able to get a positive return on their pre-sale renovations…although they likely over-spent by tens of thousands of dollars and could have achieved the same result with a smaller investment.

And what’s more, I show how a nearby property sold in that same time frame which was a “model match” for the renovated home – same age, lot size, square footage, floor plan, builder, everything – and it sold for almost the exact same price, but without any recent renovation.

It’s kind of a long video, but it’s one of the best ones I’ve cranked out in some time. So if you’re thinking of putting your home up for sale, and wondering about doing some work to it before you do, please give this video a look-see!

And then contact me to help figure out what work, if any, you might want to do in order to maximize your net proceeds, after all costs and fees, at close of escrow.