In case you haven’t been paying attention, the real-estate market has rebounded significantly in the last couple of years. After the crash of the markets in ’08, and the resulting “Great Recession” that depressed values beyond what might have been considered reasonable, we are now making up lost ground. That is, by every homeowner with skin in the game, a good thing. As a small business owner whose business is somewhat reliant upon the confidence levels of said homeowners, I have another good reason to like this development: it’s good for business.
I have learned a few things from over 20 years in the landscaping business, one of which is that when people’s largest investment in this life is losing value, they’re less inclined to spend money on improvements to that investment. And if people have learned anything from the economic and financial turmoil of the last 6-7 years, it’s that years of increasing real estate values do not guarantee that situation will continue. What can go up, can and often does come down. When it comes to investing in your home there are two schools of thought, currently, that make sense to me: one is to mostly ignore what the market is doing and to make your home into a retreat. The second, is a variation on that theme: to make your home into a retreat, but do it with an eye toward the market, and things that add value.
Another way of putting that might be: don’t invest in improvements that you have no chance of recouping. Unless, of course, you know that going in, and you can afford it. The classic example would be a swimming pool; no one builds a swimming pool in our part of the world believing they will recoup that investment. They build one because they want it. So, what kind of home improvements make sense in that way? The kitchen remodel might, depending upon the home, and the existing kitchen, as well as the proposed one. Same with the bathroom remodel(s), or the addition you’re considering. Let me make another case, one that you may not have considered: re-do the outside of your home. Only if it makes sense, of course.
Perhaps the biggest reason it makes sense is that landscaping gives you the most ‘bang for your buck’ of anything you can do to your home. I recently completed a remodel of my own kitchen, and it set me back about 22K. I acted as the General Contractor on the job, and did some of the work myself. 22K is a pretty good price for the net effect we achieved. But 22K spent in the realm of landscaping would be something rather over-the-top. If I separated out the money I spent on the custom cabinetry, 10K, and focused on that, how would that bolster my argument?
Number one, spending 10K on landscaping is a significant amount, and could easily start and finish either your entire yard, or a large portion of it. 10K only covered the cabinets in my kitchen, not the countertops, the floor or any other necessary component of the greater whole. 10K in the landscape realm would have netted me a much greater effect, I believe. Let me give you an example: several years ago a client hired us to come in and tear out his existing plants, shrubbery, and landscape rock/edging, and replace them with new plants rock and edging. This client lives on a rural site in Grant, MN. The job took two to three days, and cost him 3.9K. The effect was dramatic, almost jaw-dropping: I have never before been as struck by the difference such a modest amount could make in a before and after sense. That house, and that job, became my poster-child for the value that landscaping can add to a residence.
So, with an improving housing market, and a slowly improving economy overall, the outlook for contractors like me has improved. 2014 & 2015 look to be better years than the previous few, and I hope that pans out. If so, call early to get on my, or someone’s schedule for your project. All the best in the coming year.