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Mother-In-Law Moving In? Here’s How Much It Costs to Add a Small Kitchenette

April 30, 2021 by Staff Reporter

Maybe your mother-in-law is moving in or your adult child is living at home until they find a job. Or perhaps, you’re looking to start an Airbnb side hustle. For whatever reason, you’ve decided to build a kitchenette and are wondering how much it’s going to cost.

Despite their small size, kitchenettes cost $45,600 on average — though costs vary widely depending on size, features, and finishes. To help you get a better idea of what your miniature kitchen will run you, HomeLight spoke with an experienced contractor and analyzed project data from reputable sources on the web.

A kitchenette that you might build in your house.
Source: (Fred Kleber / Unsplash)

Here’s the average cost of a kitchenette addition:

According to HomeAdvisor, a website that records millions of remodeling estimates, the cost to build a kitchenette ranges. A basic kitchenette may cost only a few thousand if plumbing and wiring are easily accessible. In areas like the basement where you need to install new plumbing and wiring, kitchenettes cost $45,600 on average. Outdoor kitchens — projects with similar scopes to kitchenettes — run between $5,000 and $21,500 on average.

Based on this data, your kitchenette could cost anywhere from $3,000 to north of $45,000 — that’s quite the range! According to design consultant and certified Master Builder Chad Ruhoff, the cost of your kitchenette depends on two main factors: what you want and where you want it.

“The two basic things are infrastructure — which is very site-specific and depends on how you’ll run plumbing and electricity to the site — and what level of finish you want. Is it a temporary thing or something that you want to look really nice?” explains Ruhoff, who has 26 years of construction experience, specializing in small renovation projects.

To help you estimate how much your project will cost, let’s take a look at kitchenette cost factors:

Plumbing

Even in more simple kitchenette designs, a sink is fairly standard. The average cost to install a new sink in a room with existing plumbing ranges from $100 to over $1,000.

To install one, you’ll need access to your home’s water supply and drainage. So, if your kitchenette is near a bathroom or the main kitchen, you’ll pay less to install a sink than if you’re installing one in an ADU that’s 40 feet away from your house.

Additionally, if you need to run pipes underground, whether or not you have a concrete slab or crawl space underneath significantly impacts the price. Ruhoff shares that, with a crawl space, adding new plumbing is easy, but if your contractor needs to break concrete, you’ll pay more for the additional labor.

Additionally, Ruhoff tells us that the type of pre-existing pipes in your home influences cost. Homes with old pipes require more complicated (and, therefore, more expensive) plumbing jobs.

Electrical

If you want to install an electric stove or add appliances like toasters and microwaves to your kitchenette, you’ll need to wire electricity to the area.

If the room is already wired, you’re in luck. The national average to install an electrical outlet is just around $141.

However, if your kitchenette is further away, you’ll need to pay for additional wiring and labor time. The cost of new wiring and labor runs between $6 to $10 per square foot on average.

Running power to an ADU is even more expensive. In this case, you’ll have to install a ground wire and possibly a new electrical panel. Together, these expenses can cost you $2,000 to over $4,000.

A kitchenette that could be built in your home.
Source: ( Dinh Ng / Unsplash)

Cabinetry and countertops

When it comes to cabinetry and countertops, it’s more affordable to install prefab than custom units. A small prefab cabinet from IKEA costs as little as $108, whereas custom cabinets from a high-end cabinet designer range between $500 to $1,200 per linear foot.

Likewise, countertops vary in price depending on the material. Here’s a quick rundown of the prices of popular countertop materials per square foot:

  • Stainless steel: $80-$225
  • Marble: $75-$250
  • Porcelain: $60-$100
  • Engineered quartz: $55-$155
  • Butcherblock: $55-$200
  • Granite: $45-$200
  • Tile: $18-$35
  • Laminate: $15-$40

Remember that these cost ranges are averages. High-end options like unique slabs and handmade tiles may exceed the upper end of these ranges.

a gas range that you could add to a kitchenette.
Source: (Callum Hill / Unsplash)

Appliances

Appliances are another major cost factor. Tally up how much appliances will cost for your kitchenette with these average cost ranges:

Don’t forget about permit costs

Before you start ringing up contractors, check to see if kitchenettes are legal in your area.

“Depending on your city or housing jurisdiction, you may not be allowed to add a second kitchen,” Ruhoff notes.

“The reasoning behind this is that governments often don’t want a situation where you’re turning a single-family dwelling into multi-family property without going through the proper steps … They might allow you to build a kitchenette, but it might not be able to have all of the features you want.”

If your county allows kitchenettes, you’ll need to obtain a permit for the addition. Ruhoff estimates that permits can cost as much as $1,000. To determine what permits you need and how much they’ll cost, check out your city or county’s home construction ordinances. If you aren’t sure where to look, ask a local contractor.

Don’t skip this step — if you build without a permit your jurisdiction could hit you with a hefty fine and require you to apply for a retroactive permit that’s double or even triple the standard fee.

A couple looking at the costs to add a kitchenette to their house.
Source: ( DocuSign / Unsplash)

Kitchenette adds value, so you may recoup some costs

While kitchenettes cost a pretty penny, they’re a worthy investment for many homeowners. On top of enjoying the benefits of an additional cooking area, you can increase your home’s value and marketability.

Homes with accessory dwelling units that include kitchenettes are in high demand. Pew Research Center reports that 64 million Americans, or around 20% of the U.S. population, lived with multiple generations under one roof in 2016. And in 2020, more than half of adults aged 18 to 29 lived with their parents.

Kitchenettes are also popular with buyers looking to run a short-term rental. Airbnb reports that its site currently has 660,000 listings in the U.S. alone. An increase in popularity of Airbnbs can only mean more demand for kitchenettes.

With this in mind, the cost of your kitchenette addition could pay for itself in the long run!

Header Image Source: (House Method / Unsplash) 

Filed Under: BUY HOME, HOME IMPROVEMENT, SELL HOME Tagged With: Add Value, Major Home Improvements

House Codes 101: Why Codes Exist and How to Find Them

April 30, 2021 by Staff Reporter

You’ve got the DIY bug, and you’ve got it bad. Maybe you want to do something small like install recessed lighting in your kitchen, or maybe you want to build a brand-new detached garage. Either way, it’s critical to know that your project is legal.

Many home construction projects require permits from local authorities to ensure you’re building “to code.” For a building to be up to code, all of its construction needs to adhere to guidelines set up by government authorities.

If you shirk building codes, your local government could slap you with a hefty fine and force you to undo unpermitted work. More importantly, code violations can result in property damage and serious injuries for those in the house.

If you’re a DIY newbie, the idea of sorting through national, state, and local house codes might have you feeling stressed out. Thankfully, this process isn’t as difficult as it may appear. We’ll teach you how building codes work and how to find them with advice from a seasoned flipper.

A person doing a DIY project, who needs to make sure he follows house code requirements.
Source: (Valentina Giarre / Unsplash)

House codes keep us safe, and they are everywhere

“House codes exist primarily to ensure the safety and wellbeing of area residents,” explains Eric Nerhood, owner of Premier Property Buyers in Seal Beach, CA.

“Just about every state in the U.S. has house codes for their cities and towns.”

Essentially, house codes exist to prevent builders from cutting corners or making dangerous oversights that could lead to fires, cave-ins, flooding, or other serious issues that put people at risk.

House codes are revised and enforced by various government agencies at the state, national, and international levels. Ultimately, the U.S. General Services Administration reviews and approves house codes for all jurisdictions in the state. However, your local government has plenty of its own codes and will serve as your reference point for figuring out what you need to get your project started.

To understand the entities involved in creating and upholding house codes, let’s go over the main organizations for house codes.

International Code Council

The International Code Council (ICC) is the primary organization responsible for developing the various house code standards used to ensure safe and sustainable buildings worldwide.

The ICC developed the International Building Code (IBC), a set of building codes to protect health and safety while avoiding preferential treatment of specific materials or construction methods, avoiding unnecessary building costs.

Most jurisdictions in the U.S. use IBC as a base standard for developing house codes.

State building department

In addition to local building codes, your state may have its own statewide building codes. For example, several of California’s state codes regulate the design, construction, use, and maintenance of buildings.

These state codes include the Government Code, Public Resources Code, and Health and Safety Code, encompassing codes for energy conservation and green design.

Electrical wiring in a house that needs to be kept to code.
Source: (Vladislav Bulatov / Unsplash)

National Electrical Code

The National Electrical Code (NEC) is a regionally adoptable standard for the safe installation of electrical wiring and equipment in the U.S. It is part of the National Fire Code series published by the National Fire Protection Association.

The use of the term “national” may lead you to think otherwise, but these codes are not federal law. Typically, the NEC is adopted on the state or local level to standardize their safe electrical practices. In some cases, local governments may amend, alter, or even reject NEC codes in favor of regional regulations.

International Plumbing Code

The International Plumbing Code (IPC) is currently adopted on the state or local level in 35 states, the District of Columbia, Guam, and Puerto Rico. These codes pair seamlessly with ICC’s family of house codes. The IPC sets minimum standards for plumbing systems covering topics such as backflow prevention, water heaters, and nonpotable water systems (e.g., rainwater and greywater)

National Fire Protection Association Standards

In addition to the National Electrical Code standards discussed above, the National Fire Protection Association (NFPA) has other standards in its National Fire Code series. The NFPA is a private trade association, not a regulatory body, but the NFPA’s 300 plus codes and standards are widely adopted and available for free online access.

Don’t worry — not all of these codes will apply to your home construction project!

A couple checking house codes for their DIY project.
Source: (DocuSign / Unsplash)

How to find relevant codes for your home project

Now that you have an idea of the bigger picture, it’s time to get the information you need for your specific project. Nerhood advises that the quickest and simplest way to do this is to get in touch with your local government’s Building and Safety Department. “In the old days, you’d have to go down to City Hall to talk with someone, but now you can usually do everything online,” advises Nerhood.

So, if you live in a city, go to your city’s website and look around for the relevant department for an email address or phone number to contact. If you aren’t sure who to talk to, you can quickly find out by calling whatever contact number is listed on your city’s website. If you live in an unincorporated area, go through the same steps but with your county government instead.

If you want to read the codes for your jurisdiction, look through your city or county’s website. Many governments have their codes easily accessible. If you can’t find them, google “[your city here] house codes” and look for resources from .gov addresses.

Because your local government’s codes are in line with national and state laws, you typically won’t need to worry about seeking information from other government agencies. If you do, your local government will provide you with instructions. Still, if you’d like to read about your state-level house codes, you can find them with this directory.

Beyond building to code, you need to obtain permits

Even if you’re sure that your building project won’t violate any codes, you may still need to get a permit before starting construction. To obtain a permit, you or your contractor submits a plan to the local government. Once the plan is approved, you’ll be issued a permit, and you can get to work. Later on, an inspector will check the work to confirm that it meets the plan and is up to code.

Nerhood warns that even small-scale projects may require a permit. “Even something as little as upgrading a window or replacing a single light fixture with a canned light needs to be permitted. I once retrofitted a window without even breaking the stucco or making any changes to a building’s frame. As I was doing it, an inspector drove by and warned me that I needed to get a permit. It’s a perfect example of something that you wouldn’t even guess would need one.”

Once you’ve confirmed your project is legal and safe, you can break ground and install that beautiful new pool (or window)!

Header Image Source: (Brett Jordan / Unsplash)

Filed Under: BUY HOME, HOME IMPROVEMENT, SELL HOME Tagged With: Add Value, Major Home Improvements

Your Home Lacks a Garage: What Will It Cost to Build One?

April 30, 2021 by Staff Reporter

You love your house, except for one little detail: It doesn’t have a garage, or your existing garage is falling apart. Perhaps you live in the city where garages aren’t a guarantee. In 2019, as many as one in five new homes in the New England region were built without this coveted feature.

If you’re tired of your current garage’s condition or size, that’s valid, too. Garages built in the ’30s, for example, can be frustratingly small to the point where you can’t even park inside. And just like homes, garages age and deteriorate over time, sometimes requiring replacement. A mid-size SUV today weighs between 4,000-5,000 pounds — that’s a lot of strain on your concrete floor alone.

But having a functional garage keeps your car in top condition longer while providing flex space. Attached or detached, a garage can transform into a storage unit, a workshop, or makeshift fresh air living area (a use case that has risen in popularity during a pandemic).

Before you start dreaming about jumping into a warm, garage-parked car on a cold morning, let’s talk numbers. In this guide, we’ll cover:

  • The average cost to build a garage based on web estimates
  • The most common expenses to account for in a garage build
  • How much value a garage can add to your home at resale
A garage on a house that you might build.
Source: (Emil Diallo / Unsplash)

The cost to build a garage: General overview

The cost of your garage build will depend in large part on how many cars you need to store and the level of frill you’re looking to add. For example, garage doors can range anywhere from $400 to $3,000 (more on that below) — and you can spend more if you decide to include windows and insulation.

According to an analysis of Census Bureau data by Eye on Housing, two-car garages remain the most popular parking option for new construction, with 65% of these homes offering a two-car garage. However, garages can house as few as one car or be large enough to accommodate an RV.

In addition, you’ll pay approximately 10%-15% less on an attached garage as you would a detached structure of a comparable size, according to HomeAdvisor. To provide some general cost ranges, we’ve compiled pricing data from some of the most reputable cost aggregator sources across the web, including HomeAdvisor, Fixr, and HomeGuide:

Fixr

Attached garage avg. costDetached garage (2-car) avg. costOne-carTwo-carThree-carFour-carRVLow and high-end rangeAvg. cost per sq. ft.
$35,000$52,830$18,000$28,000$34,500$45,000$52,000$18,000-
$100,000
$60.76

Methodology: Fixr estimates the cost of home renovation projects through specialty publications, government reports, contractors, and vendor sites.

HomeAdvisor

Attached garage avg. costDetached garage avg. costOne-carTwo-carThree-carFour-carRVLow and high-end rangeAvg. cost per sq. ft.
$27,746$31,908 (an avg. 15% more than a similar attached version)$11,500-$20,200$23,000- $40,300$36,000-$63,000$41,000- $71,100$36,000- $140,000$6,000-$60,000$50

Methodology: HomeAdvisor uses the actual costs reported by 1,416 user-submitted projects. 

HomeGuide

Attached garage avg. costDetached garage (2-car) avg. costOne-carTwo-carThree-carFour-carLow and high-end rangeAvg. cost per sq. ft.
$23,900$24,200$10,850$23,900$35,450$42,700$7,500-
$42,700
$35-$60

Methodology: HomeGuide tracks estimates users receive from local experts and contractors for each project, based on millions of inquiries per year across the site.  

When deciding what type of garage you want, consider what your neighbors have in addition to your own needs. For example, avoid building a massive detached garage in a neighborhood of one-car attached garage — otherwise, your structure will stick out like a sore thumb, advises John Kriza, a top real estate agent in Chester County, PA, with over 20 years of experience.

A woman deciding how much it will cost to build a new garage.
Source: (Bruce Mars / Unsplash)

Common expenses to consider

You’ll need to account for a variety of line items in your overall garage addition budget. Below, we go through some of the most common factors that can increase costs.

Garage demolition

Maybe your hundred-year-old home has been frequently updated over the decades while the corresponding garage was neglected. In that case, you’ll need to budget for any costs involved with removing the dilapidated structure so that you can start fresh.

According to Hometown Demolition, a local demolition contractor in Grand Rapids, MI, since 2009, the average cost to remove a garage is somewhere between $1,000-$3,000. One nice thing is that the worse the garage’s condition, the less you’ll have to spend to demo it, the contractor notes. Ho

Garage size

The size of your garage will be the most significant determining factor in the project’s price. The larger the garage, the bigger the budget. As you contemplate the garage size you want, consider that many standard garage sizes come in “half sizes,” which means they can accommodate storage or a home workshop area.

Standard DimensionsNumber of CarsTotal Square FeetAverage Cost (at $50 per sq foot)
12’x24’1288$14,400
14’x28’1-1.5392$19,600
20’x20’2400$20,000
24’x24’2-3576$28,800
36’x24’3-4864$43,200

(Source: HomeAdvisor)

Permits

Whether you build an attached or detached garage, you’ll need a permit issued by your local building department that confirms your structure will comply with local ordinances and codes.  If you plan to wire the garage for water, electricity, or heat, you’ll likely need to pull separate permits for each utility as well depending on your municipality. The cost of a garage permit will vary based on your city, but you can expect to pay between $1,200-$1,500 to move forward with the project — not an insignificant chunk of change!

Labor

Depending on your garage build, the labor cost will fluctuate between $20-$30 per square foot, according to Fixr. So if your garage build costs $35,000, you can expect $15,000 of the final price to be labor. This estimate doesn’t include labor costs associated with an electrician to wire your garage. Small electrical projects typically range between $141 and $419 but can increase based on complexity.

Concrete foundation ($140 per cubic yard)

Your garage build will start with pouring the foundation. The bigger your garage, the larger its foundational footprint and more expensive the cost to pour concrete. For reference, pouring the foundation of a 20’x20’ two-car garage will cost between $2,124 and $3,324. If you pour your foundation in slabs, it can also serve as the flooring for the garage.

A person installing insulation in the garage they are building.
Source: (Erik Mclean / Unsplash)

Siding

If you’re building an attached garage, you might use siding that matches the rest of your home or choose a contrasting finish to create a dynamic look. Here’s what you can expect to pay per square foot for various types of siding:

  • Fiber cement ($5-$25 per sq. foot, installed)
    A more recent addition to the world of siding, fiber cement is used on 15% of new homes. It can mimic the look of wood, stone, or brick but requires minimal upkeep and is virtually rot and termite-proof.
  • Vinyl ($3-$12 per square foot, installed)
    Because of its lower price point, vinyl siding is a popular choice for garage builds. Vinyl is easy to install and maintain, but it can hurt your home’s value if its appearance will clash with your home’s existing style. For example, vinyl siding can be a problematic choice when it comes to pairing it with classic or historic homes.
  • Metal ($3-$8 per square foot, installed)
    Metal siding is generally the most affordable siding and requires little maintenance beyond cleaning with soap and water. Metal is also eco-friendly; it’s made from recycled metals. However, metal siding isn’t very DIY friendly, and because it conducts heat so well, your garage might require more insulation to keep a regulated temperature.
  • Brick ($5-$15 per square foot, installed)
    Installing brick siding is more expensive than some alternatives, but it can give your garage a timeless look. Brick requires almost no maintenance and can save you on your insurance policy because it is fire and extreme-weather resistant.
  • Wood ($6.50-$12 per square foot, installed)
    With wood, you’ll find a myriad of stains and finishes to choose from at various price points. While it’s visually appealing, wood requires regular maintenance and can be very flammable if not treated.
  • Stone veneer ($6-$11 per square foot, installed)
    Stone veneer or faux sheetrock is less expensive than the real deal, and because the material is lighter weight, it is also easier to install. But mass-produced siding can look repetitive, taking away from the unique appeal of the stone. Additionally, if installed improperly, moisture can seep past the siding.

Framing ($1-$5 per square foot)

Framing provides the necessary support for your garage walls and can be achieved using materials such as wood, steel, or engineered wood. Labor to put up the framing will cost between $4-$8 per square foot on average and can cost more based on complexity if you’re building a garage onto an existing structure.

Insulation ($.50-$2 per square foot)

You don’t have to insulate your garage, but if you plan to keep more than cars in the space, it can help regulate temperature.

  • Blown-in or loose-fill insulation costs $1,000-$2,000 on average to install.
  • Batt insulation costs $1,000-$2,000 on average to install.
  • Spray foam, most expensive option, costs between $1,300-$3,700 on average to install.

Windows ($380-$3,800 per window)

Installing a window is once again optional, but if you plan to use the space beyond just storage, some natural light can make the garage more enjoyable to spend time in. Installing a window will cost between $380 and $635, labor included, and a skylight will run between $650 and $3,800, based on complexity.

Drywall ($1-$3 per square foot)  

Hanging drywall in the garage isn’t required, but it can make the space feel more finished or polished, especially if you want to hang shelving or other storage. The overall average cost to hang drywall in a room is $1,842, but the project could cost more or less, depending on complexity.

Garage door ($400-$2,800, based on material)

A high-quality garage door can boost curb appeal and help reduce your energy bills. Doors can be made of various materials, including steel, vinyl, wood, and fiberglass. While a good door may be pricey, you’ll likely recoup most of your costs in resale value. Remodeling Magazine’s Cost vs Value report estimates homeowners will recoup 94.5% on the project.

Loft above the garage ($180-$210 per square foot)

A room above the garage could be the perfect home office, studio, or potential apartment space down the line. If you want the space for additional storage, you can expect to pay within the $30,000 to $40,000 range, according to Fixr, but if you want it to be a living space, you’ll need to budget $60,000 or more.

Two men looking at the addition of a garage on their home.
Source: (Nathan Dumlao / Unsplash)

How much value will a garage addition add?

Having a place to park your car out of the elements not only makes your life easier, but it can add value to your home. According to personal finance site Pocket Sense, you can expect an 81% ROI when adding an average garage. Per another certified residential appraiser estimate, an adequate garage can add anywhere from $5,000 to $25,000 in resale value. But ultimately, adding value won’t ever be the best reason to start building a structural addition onto your property. “The choice has got to be for your own enjoyment,” advises Kriza.

Header Image Source: (Erik McLean / Unsplash)

Filed Under: Apartments, BUY HOME, HOME IMPROVEMENT, INSURANCE, SELL HOME Tagged With: Add Value, Major Home Improvements

How Top Agents Approach Writing a Comparative Market Analysis

April 30, 2021 by Staff Reporter

Your listing agent comes to you with a fairly thick package of paperwork and says: “Here’s the comparative market analysis (CMA) for your house — let’s talk about what we should sell it for.” For some sellers, a cursory glance through the pages may suffice before they move on to getting their house live on the market. However, others are more curious to know: How do you write a comparative market analysis? What goes into this process?

The standard CMA can span over 30 pages long and be confusing to digest with such a dense mix of data, tables, and housing market jargon. So, we spoke with a couple of top agents in two different parts of the country to simplify it all for us. As we pulled back the curtain, it became clear that “writing” a comparative market analysis has a lot more to do with gathering the correct information and knowing how to analyze it than it does penning great prose.

Here we’ll break down the process of putting together a CMA into five basic steps:

  1. Do a deep dive into the subject property.
  2. Gather up your comps using a tight radius.
  3. Evaluate each comparable property individually.
  4. Look at overall market trends.
  5. Reconcile your findings.

With that overview in mind, we’ll now go through each part in further detail — letting the pros guide us!

An image of colorful houses to demonstrate how to write a comparative market analysis.
Source: (Daria Nepriakhina / Unsplash)

1. Do a deep dive into the subject property.

You may have a baseline understanding of a CMA, but a quick refresher: A comparative market analysis is a tool that your listing agent will use to help determine the appropriate market value of your home. It pulls in a bunch of details about nearby properties of a similar size and style that have recently sold in your area, and uses their sale prices as a benchmark when setting your home’s list price.

Your home is the star of the CMA, so the document should start with a profile of the property. Rick Fuller, an experienced real estate agent in Contra Costa County, California, spends a lot of time studying the characteristics of the home being sold. “The more information we have on the property, the more likely we’ll arrive at the right price that aligns with the market value,” he says.

The CMA should include all of the key details about the property that could impact its value, such as:

  • Address, community, and neighborhood
  • Square footage and number of stories
  • Property photos
  • Age
  • Number of bedrooms and bathrooms
  • Location, accessibility, and parking
  • Type of flooring
  • Type of foundation
  • Lot size and features
  • Type of heating, cooling, and roofing systems
  • Any renovations and upgrades
  • Highlights and features (i.e, garage, finished lower level, great views, pool, fencing, security system, high-end finishes, etc.)
  • Sales history and value adjustments over the years
An image of a neighborhood from above to demonstrate how to write a comparative market analysis.
Source: (Braden Egli / Unsplash)

2. Gather up your comps using a tight radius.

Once the agent has done due diligence on the focal property, it’s time to widen the scope to see how it measures up to the surrounding homes. That involves looking at sales comps, which are similar homes that have recently sold in the area.

Laurie Cappuccio, a top real estate agent in Reading, Massachusetts, has created hundreds of CMAs in her 24-year career. When gathering sales comps, she starts by looking at nearby homes that have sold in the past six months. To make sure she’s comparing apples to apples, she takes the time to fine-tune the list of properties so that they’re as similar as possible to the subject home.

How many comps should be included?

Cappuccio points out that the number of comparable properties she comes up with will depend on the time of year and the state of the market. “There is no fixed, set number of homes to include,” she says.

Fuller generally aims to have at least 20 total properties in his CMAs, split into four different categories:

  • At least five active listings: Homes that are currently on the market
  • At least five pending properties: Homes that are under contract but have not yet closed
  • At least five sold properties: Homes that have recently closed
  • At least five expired/withdrawn homes: Homes that were listed on the market, but were then removed without being sold

How close do the comps need to be?

Generally speaking, the closer the comps are to the subject property, the more accurate the CMA’s assessment will be. That said, the distance of the comps will vary by neighborhood. If the subject property is in a rural area or a community where houses have sprawling acreage, the comps may have to be several miles apart, Fuller explains. But for others, they may be located in the same subdivision.

The distance may also increase if the property has unique features that are tough to match. For example, Fuller sometimes has to look farther out to find homes that have a similar view, pool, lot size and orientation, design style, or some other specific characteristic.

3. Evaluate each comparable property individually.

After coming up with the high-level list of comps, the agent will do a deeper dive into each of the individual homes, including key information like:

  • Photo and map of location
  • List price and current estimated value
  • Year built
  • Number of bedrooms and bathrooms
  • Square footage and lot size
  • Garage information
  • Information on roofing and HVAC systems
  • Additional features (i.e., fireplace, pool, view, upgrades, etc.)
  • School district
  • Description/summary of the property

Most CMAs will include a chart with key features across multiple properties, making it easy to scan and compare.

An image of a comparative market analysis to demonstrate how to write a comparative market analysis.
Source: (Rick Fuller)

4. Look at overall market trends.

While it’s important to “zoom in” and research individual properties in the area, the CMA should also “zoom out” to look at an overall market snapshot of what’s happening sales-wise in the area. Fuller includes a color-coded map that shows how pricing fluctuates in different neighborhoods, and also presents the median estimated home value, the median listing price, the median number of days on the Realtors Property Resource (RPR), and the sales volume. This analysis provides a valuable context when determining the sales price of the subject property based on where it falls in the map.

The CMA should also look at other trends in the market, such as:

  • List price vs. sales price
  • Average price adjustments
  • Median home value vs. median listing price
  • Median sale price vs. sales volume
  • Median listing price vs. listing volume
  • Median sale price by square footage
  • Price range of homes sold
  • Age range of homes sold

5. Reconcile your findings.

After gathering all of the comparable properties (sold, active, pending, and withdrawn) and analyzing the market trends, Fuller moves on to the reconciliation stage, where he crunches the numbers to determine the trajectory of the real estate market.

“Are values going up or down? If they’re going up, we may set the price higher. If they’re going down, we may price it lower,” he explains.

Most of Fuller’s reconciliations end in a price range rather than a fixed number. “Most homeowners select a range based on condition, how quickly they need to sell, or outside circumstances like loan modifications, a short sale, or a pending foreclosure,” he says. “When we can list their property within a price range, that gives them some flexibility.”

Cappuccio doesn’t always include recommended pricing in her CMAs. Instead, she prefers to make it more of a conversation. “When I start my meeting, I ask the homeowner for their expectations of what their home is worth,” she says.

“We also talk about the importance of intelligent and realistic pricing. While their home may have great features, they need to realize that unless it’s a cash deal, it still has to appraise for the sale price.”

Should a homeowner consider doing their own CMA?

Do you need a real estate agent to create a CMA for you? Technically, you could cobble together your own DIY comps analysis by searching for recent home sales in your area, then creating a chart comparing all of the property details and features. You can also check out online tools, like HomeLight’s home value estimator, to plug in an address and find out the approximate value of a property.

That said, selling a house and transitioning to a new one isn’t exactly a low-stress life event — especially when juggling work, family, and other obligations. If you’ve got your hands full and time is in short supply, it can be a game-changer to have an experienced agent in your corner to crunch the numbers. Plus, with an agent’s experience in creating countless CMAs, they can likely do it faster and more accurately. In addition, an agent’s seamless access to MLS data helps them get a complete picture with all the necessary information more efficiently.

“Homeowners may try to guess at the value of their home by getting online estimates or talking to their neighbors, but those methods don’t take into account an assessment of market value,” says Fuller. “They can’t determine the home’s condition, upgrades, views, and market trends. Only the CMA can accurately do this.”

Header Image Source: (89stocker / Shutterstock)

Filed Under: BUY HOME, HOME IMPROVEMENT, SELL HOME Tagged With: Add Value, What's My Home Worth?

Save the Planet in Style: Your Guide to Sustainable Home Design

April 21, 2021 by Staff Reporter

A 2020 study by PEW Research Center found that 63% of Americans believe that climate change affects their local communities. If you’re among eco-minded homeowners, you should know that investing in sustainable home design is one of the most powerful ways to reduce your environmental footprint.

“Green building isn’t just chic — the benefits reach into every aspect of our lives,” shares Cassy Aoyagi, board member of the Los Angeles Chapter of the U.S. Green Building Council (USGBC-LA) and president of FormLA Landscaping.

“The same building strategies that protect the environment improve our physical and mental health. They make us more resilient to challenges like the pandemic. They can decrease our risk to ‘natural’ disasters like wildfire, flooding, and mudslides, as well as our energy and water bills.”

Ready to improve your home’s sustainability? Here are 12 ways to create a greener, healthier living space.

A homeowner researching sustainable design in a wood home.
Source: (Surface / Unsplash)

Sustainable wood might sound like an oxymoron to those of us who remember the Save the Rainforest campaigns of the late 1980s and early 1990s. However, wood sourced from sustainably managed forests is better for the environment than materials like cement and steel.

Cement and steel account for 38% of carbon emissions in the manufacturing industry. Since the manufacturing industry is responsible for more human-caused emissions than any other sector, disrupting it has the potential to slow down climate change. The challenge, though, comes in finding a viable alternative.

Enter mass timber; a term broadly used to describe wood products engineered to match the structural capabilities of concrete and steel. This material performs well in fire, expedites construction times by up to 25%, and withstands impact from earthquakes exceptionally well.

But what about cutting down our forests? The beauty of mass timber is its engineered character. Manufacturers can use dead or dying timber to create it, effectively preventing forest fires by removing these dried trees. So long as long as you’re using ethically farmed mass timber, this sustainable option is a no-brainer.

2. Look for GREENGUARD Certification or CRI Green Label Plus Certification

The EPA has found that Volatile Organic Compounds (VOCs) are two to five times higher in indoor environments than outdoors since many household items leak toxic chemicals like formaldehyde into the air. In a high enough concentration and with a long enough exposure, these chemicals pose significant health risks, namely respiratory illness.

This risk is substantial considering that many Americans are spending more time at home with the increase of remote work. Not to mention that those who are most vulnerable to the health consequences of VOC exposure (like those lung disease) spend disproportionately more time indoors.

Thankfully, organizations have emerged to help test and promote products that don’t emit VOCs. Underwriter Laboratories (UL), a global safety standard organization, created the Greenguard Certification to help consumers identify products “scientifically proven to meet some of the world’s most rigorous third-party chemical emissions standards, helping to reduce indoor air pollution and the risk of chemical exposure.”

Likewise, The Carpet and Rug Institute’s Green Label Plus Certification identifies adhesives, carpets, rugs, and cushions that have met stringent criteria for low emissions. An independent laboratory must test and certify a product for it to bear the CRI Green Label Plus logo.

It’s particularly crucial to select a carpet with this label since carpets are notorious for off-gassing toxic VOCs: first, flooding a home after installation, and then slowly leaching chemicals into the air for years to come. You can easily find Green Label Plus certified products in the Carpet and Rug Institute’s database.

A curtain letting in natural light in a home that was sustainably designed.
Source: (Orlova Maria / Unsplash)

3. Orientate your house for natural light and heat

The electricity that powers our buildings (both residential and commercial) accounts for 55% of global electricity consumption. To make a meaningful dent in this massive chunk of consumption, think beyond good habits like turning the lights off and cutting back on heater use. Modify your home to optimize light and thermoregulation.

Strategically placed windows keep your home warmer (or cooler) during the day and reduce your need to run the HVAC. For instance, southern-facing windows allow more natural light into your home, so you don’t need to keep as many lights on in the daytime.

Where you live — the unique climate and topography — influences the most efficient window placement. Though there are a few basic principles:

  • Maximize southern-facing windows and doors to get the longest sun exposure.
  • Limit western-facing windows to avoid excessive heat.
  • Add more northern-facing windows for even natural lighting that lasts most of the day.

Some additional bonuses? The UV rays in sunshine act as an antiseptic, and all that natural light can increase serotonin and endorphin levels.

4. Adorn walls with recycled glass tiles

Carbon dioxide emissions from ceramic tile production emit a whopping 180,000 metric tons a year. While this number pales in comparison to emissions from the likes of cement or steel, it’s significant enough to second guess that glass backsplash on your Pinterest board.

But thankfully you don’t have to sacrifice style for sustainability: Recycled glass tiles offer a chic and eco-friendly solution. The tiles are made through a traditional glass recycling process. Manufacturers melt down glass refuse (like recycled bottles), then dye and reform the glass into sheets that they cut into glass tiles.

Recycled glass tiles are available in an endless array of colors, shapes, and sizes. You don’t even have to commit to the glassy look since there are ceramic and marble imitations like these Calcutta lookalikes.

Bonus: Consider terrazzo for floors or countertops. This versatile recycled glass material is a favorite in LEED-certified buildings. Terrazzo was a favorite of Art Deco designers in the movement’s heyday in the 1920s. Today, this design fad is making a roaring comeback a century later.

5. Cozy up to eco-friendly insulation like denim or Thermacork

The very color green summons to mind the eco-adage: Reduce, Reuse, Recycle. Try as we might, it’s rare that we’re able to act on all three at once. But choosing sustainable insulation is an easy way to check off all three R’s of sustainability.

Properly insulating your house can significantly reduce the amount of energy needed to control indoor temperature. Though insulation is a fairly simple upgrade, it makes a huge impact since over half of all energy use in American households is dedicated to heating and cooling needs. With a properly insulated home, you’ll not only lower your energy bills but also feel more comfortable indoors with fewer temperature fluctuations throughout the day.

You can double the positive impacts of insulating your home by choosing insulation made of reused or recycled materials, like denim or Thermacork. You read that right: denim — the same stuff your 501’s are made out of. In fact, the denim in your jeans and in your walls may have come from the same place. Denim insulation is typically made from the unused or leftover swaths from clothes manufacturers.

You’ll have to pay just under double the cost of fiberglass insulation for this environmentally friendly option at about $1.10 per square foot as compared to about $0.60 per square foot. But the price may be worth it when you consider you’re tripling your positive environmental impact by reducing, reusing, and recycling all at once!

And if you really want to reduce your carbon footprint, consider the carbon negative option of Thermacork for $3.50 per square foot. Thermacork is sustainable since it’s made from the leftover cork sheets used to make wine corks, which utilize only about 30% of the product. Thermacork manufacturers heat these sheets, expanding the material and activating a natural binder in the cork to create a cohesive material, and then slice the sheets into insulation boards.

Another benefit: Cork manufacturers can harvest the bark from mature oak trees without cutting the trees down. That means that the trees can continue to pull carbon dioxide from the atmosphere, compounding the reduction in greenhouse gases.

Whichever eco-friendly insulation you choose, you’re also doing an important part to reduce dependence on less environmentally friendly options. For example, the popular insulation material, fiberglass, can produce toxic air emissions during production, including styrene, a chemical that can cause damage to the central nervous system. The chemicals used in fiberglass fabrication can also react with the air to form smog, a form of ground-level ozone, which causes a number of respiratory effects.

Two men installing sustainable windows into a home.
Source: (Dmitry Kalinovsky / Shutterstock)

6. Invest in double pane windows

Windows are responsible for 25% to 30% of all residential heating and cooling energy use because of heat gain or loss through these permeable features. If you have single-pane or leaky windows, you’re likely using significantly more energy to regulate indoor temperature.

While replacing windows is a more expensive sustainable home upgrade, this project offers a tangible return on investment. High-efficiency windows can save you up to $583 a year on energy costs, add over $9,000 to your home value at resale, and reduce your home’s carbon dioxide emissions by over 6,000 pounds by cutting back on a home’s energy use.

When shopping for these upgrades, look for the Energy Star label. Energy Star is a government-regulated label for products that meet the strictest standards of energy efficiency. The best part? Energy Star window labels also help you determine the model that is best suited for your climate.

7. Upgrade to an insulated garage door

Many garage doors lack proper insulation, allowing outside air to enter your home. In a three or four season climate, this permeability means big energy losses for your home. If your garage door lets air in, replace it with an insulated model to instantly boost your home’s energy efficiency.

When shopping for an insulated garage door, look at the R-Value. This is the measure of thermal efficiency – the higher the value, the more protection it offers. An R-value of about 7 to 9 is adequate for most attached garages, though you’ll want an R-value of 10 or above if your garage is connected to your HVAC system. According to Energy Star, properly sealing your home’s thermal boundaries – walls, windows, and garage included – can save you $200 annually, or up to 10% on total energy bills.

8. Consider adding solar panels

Can you imagine passively generating power, reducing energy bills, and even selling back the power you produce to the grid? Though it might seem too good to be true, these are all benefits of going solar. But that’s not all! According to the U.S. Green Building Council, solar energy is environmentally friendly in two other key ways:

Beyond making sustainable gains, solar panels can increase your home value by as much as 4%. Just note that this is only true for owned solar panels — leased solar panels don’t add value to your home since they don’t belong to you and aren’t considered real property.

Pro tip: 2021 is a great year to add this project to your Green Home To-Do List. All owned solar systems (whether bought with cash or through financing) installed before December 31st, 2021, are eligible to claim a 22% tax credit.

9. Add a solar hot water or tankless water heater

Look no further than your faucet to reduce your energy use: converting your hot water heating to a solar and tankless system offers unbeatable savings. Tankless hot water heaters heat water as needed instead of in large batches like traditional water heaters. This process leads to less energy wasted on hot water that is never used, plus lower energy bills — this amounts to saving the average household $115 per month. That being said, the energy savings of solar water heaters are unmatched: The Department of Energy estimates that a solar water heater can cut energy costs by 50%.

These water heaters are more expensive than traditional models, though. For tankless systems, prices vary depending on the type (i.e., natural gas, propane, or electric) and equipment needs (i.e., vent kits, gas connectors, insulation, etc.) for your home, but units typically cost between $500 to $1,500., Installation costs an additional $1,000 or more, with the national average coming in at a little over $2,100.

The high price tag is for a good reason. Any hot water heater installation is a highly technical and dangerous process that requires the skills of a plumber, carpenter, and electrician; converting a home from a traditional water heater to a tankless one makes the process even more difficult. An improperly installed tankless water heater can lead to an explosion, gas leak, or fire. Many counties even require that this home improvement project is handled by a professional, so check your local code before you attempt to DIY.

Solar water heaters retail at a similar price point. Expect to pay anywhere from $1,000 to $4,000 for a unit, and an additional $1,000 to $3,000 for installation. Active systems — which maintain a constant flow of hot water — are on the more expensive end of this range, while passive systems — which simply heat water supply with available sunlight — are on the cheaper side. Manufacturers also recommend that you have a backup system in case of extended cloudy weather.

A room that has not been sustainably designed in a home.
Source: (Katja Bayer / Unsplash)

10. Avoid materials with toxic chemicals like formaldehyde

Avoiding toxic chemicals sounds like a no-brainer, but it can be more difficult than you realize. Toxic chemicals are all around us: in the products we use to clean, in our furniture, and even in the paint on our walls. The ubiquity of these substances is exactly what makes them so dangerous. Don’t get caught unsuspecting and look out for these common toxins on product labels:

Volatile Organic Compounds (VOCs)

VOCs are a group of chemicals found in flooring, composite wood products, adhesives, and a variety of other common household products. As mentioned earlier, VOCs “off-gas” or emit toxic chemicals into the air we breathe. Breathing in VOCs can cause irritation to the eyes, nose, and throat, difficulty breathing, even damage to the central nervous system.

Reduce your exposure by airing out your home for several days after installing anything that uses materials with VOCs. You should also store unused chemicals in a well-ventilated part of your house, like a garage.

Formaldehyde

This chemical is a common preservative found in manufactured woods that scientists have linked to cancer. To reduce your exposure, look for wood products that use the more eco-friendly and formaldehyde-free phenol resin.

Phthalates

This group of chemicals is most commonly found in plastic items and vinyl flooring. More studies are needed to understand the extent of the impact that phthalates have on humans. However, the Center for Disease Control reports that phthalates have affected the reproductive system of laboratory animals. These chemicals can be harder to spot in household materials, but the Fair Packaging and Labeling Act requires that they are listed on any consumer commodities. You can avoid purchasing flooring with phthalates with natural options like wood or stone.

Petroleum

Most plastics contain petroleum, which still carries the environmental impacts and implications of oil drilling and production. While plastic (and thereby petroleum) is hard to avoid outright, begin reducing your consumption by looking for latex-based paints, products made with soy or beeswax, and natural building materials.

Polyfluorinated Compounds (PFCs)

Like VOCs and phthalates, PFCs are a group of chemicals commonly used as a finish to make building materials more stain, water, and grease resistant. Animal studies have suggested that PFCs reduce immune function and can even cause developmental difficulties; however, more studies are needed to understand their full impact on humans. The National Institute of Environmental Health Sciences says that we consume PFCs through using products containing them or simply breathing in air that does. As with the other toxic chemicals listed here, the best way to avoid PFCs is simply to look for them on the ingredients in common household items.

11. Embrace sustainable landscape design

When it comes to a sustainable home, your yard is yet another important place to upgrade with eco-friendly features. Aoyagi, who has enjoyed a long career in sustainable design and landscaping, says, “We’re now looking beyond buildings to our landscapes and neighborhoods where we can, once again, exponentially improve the resilience of our clients and our communities.”

Increasing resilience is particularly important when it comes to water savings. The average bermudagrass lawn requires 500 gallons of water per year. This might not be a problem in a damp climate like the Pacific Northwest, but in the arid sunbelt, where major cities like Phoenix average only eight inches per year, those 500 gallons deplete water resources fast. Not only can this strain the water supply, but it also costs homeowners in the Valley of the Sun extra to water in peak seasons when lawns need it most.

To cut down on water usage and ensure you don’t end up with a brown lawn in the heat of the summer, Aoyagi recommends prioritizing native plants for your outdoor space. These species will be more naturally adapted to the environment of your home, and therefore, require less water and fertilization. Native species also require less upkeep and, if planted strategically, can often survive off the natural rainfall alone. They may even have a restorative effect on the environment by providing shelter for wildlife local to your area.

12. Beware of “greenwashing”

As the name suggests, greenwashing is the process by which companies convey false or misleading information about a product to present it as more environmentally friendly. Follow these three tips to ensure your sustainable upgrades are the real deal:

  • Read the labels: If a product or material claims to be made of recycled materials, see just how much of it is made from these sources. It may be less than you think. For example, check out this 100% recycled rug from West Elm compared to this one from Wayfair, which is simply listed as “recycled.”
  • Check for certification, like Greenguard, Energysaver, and LEED: Products with these labels meet rigorous standards put out by environmental agencies dedicated to bringing sustainability to the construction industry.
  • Partner with an eco-expert in your area: Going green can feel intimidating, but the help of a sustainable designer can make your green transition seamless. Lean on these pros to make the science work for you and harness the green potential of your home.
An aerial picture of homes in the shape of Earth.
Source: (Joshua Rawson-Harris / Unsplash)

Sustainable home design makes for a happier, healthier world

If you’re considering going green in your home build or renovation, it’s likely not just about the numbers for you. (Although, it does help that sustainable homes sell for higher prices than their counterparts.) Eco-conscious building choices ensure a safer, cost-effective, and stylish home while codifying your commitment to the planet. Don’t be intimidated by the entirely self-sustaining designs of Earthships — sustainable home design begins with your commitment to keep the planet in mind, one eco-friendly upgrade at a time.

Header Image Source: (Vivint Solar / Unsplash)

Filed Under: BUY HOME, COMMERCIAL, HOME IMPROVEMENT, INVESTING, SELL HOME Tagged With: Add Value, Major Home Improvements

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