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2020BY WENDY A. JORDANt o the property for tax purposes) had
risen to $400,000. Over about six weeks
Barrett invested $65,000 on fix-ups to
make the house appealing to buyers, and
that increased the cost basis to $465,000.
Listed at an attractive price of $515,000
in November 2017, the house drew many
offers and sold for $520,000 in Decem-
ber 2017. After subtracting costs and
accounting for the stepped-up value,
Barrett realized a profit of about
$90,000. But subtracting the $65,000 in
presale improvements yielded a taxable
capital gain of just $25,000.
Reaching such a happy ending when
selling a house is not just good luck. It
involves careful planning and control,
and a team of well-chosen experts.
Knowing some of the rules of how to
upgrade and sell a home for a profit is
especially important now that the mar-
ket is in turmoil from the coronavirus
pandemic.
“Most buyer’s agents are showing va-
cant homes and using hand sanitizer/
wipes upon entering and exiting the
home,” said Jane Morrison, an agent
with Geva and Jane Real Estate. “Occu-
pied homes have different protocols
based on the homeowners’ desires.”The right agent is key
Step one is choosing the right real
estate agent. Andrew Schroeder, chief
executive of Fairfax, Va.-based Schroeder
Design Build, a remodeling company
that also buys, improves and sells homes,
says: “The appropriate agent knows your
area, your buyer, your exact market.”
That knowledge informs all the deci-
sions as the house is prepared for sale.
Real estate agent Lenore Rubino of
Washington Fine Properties, says that,
“while a good agent can turn around a
house quickly for market, optimally
owners should come to us a year or six
months ahead” of a planned home sale,
so she and Washington Fine Properties
agent Karen Nicholson can help the
owners identify necessary repairs,
choose improvements that will add sales
appeal and boost the asking price — and
recommend contractors who can do the
work well, cost-effectively and on sched-
ule.
Barrett said he turned to Morrison
because she specializes in Arlington
neighborhoods. Morrison recommend-
ed specific changes to make to the house,
whom to hire for the work and what
selling price to ask. She also helpedcover storyPutting your
best place
forward for sale
Smart, cost-efficient updates and improvements
and t he right Realtor can yield a higher return
eugene smith for the w ashington postWhen Geoffrey Barrett inherited a 1942 brick duplex from a relative,
it was a diamond in the rough. Diamond because of its location in a
convenient, in-demand Arlington, Va., neighborhood. Rough because
of its deteriorated condition. ¶ Barrett wanted to bring back the shine
and sell the property quickly for top dollar. As a mortgage finance
professional, he said he knew that to achieve the most bang for the
buck meant making only the right improvements to the house and
spending enough — but no more — on the work. That is, “not over-
improving it,” he says. ¶ Spoiler alert: He did it. Barrett’s relative
bought the 1,140-square-foot house for $159,000 in 2000. When
Barrett became owner in fall 2017, the cost basis (the value assignedBarrett decide whether to consider an
offer to buy the house as-is for $325,000
before it was listed. She advised against
it, as a fixed-up house could command a
higher sales price and better profit. (As
Barrett points out, since the $25,000
taxable profit is based on the $400,000
stepped-up value rather than what was
offered for the unrenovated property,
“the real profit was actually $75,000
higher than that $25,000 — when you
account for the difference between
$400,000 and $325,000.”)
Morrison says the three-bedroom,
two-bath house was dilapidated but had
a lot to offer, including a main-level
master bedroom and bath in a rear
addition, a finished basement, “a great
location, a yard, a driveway, and hard-
wood floors.”
“For top dollar, you want to show that
the house has been cared for,” Rubio says.
It should be as clean and pristine as
possible. On Morrison’s recommenda-
tion, Barrett refinished the floors, re-
placed the carpeting, repainted the en-
tire interior, made simple improvements
to the second-floor bathroom, and added
new carpeting and recessed lighting in
the basement.
Nicholson says a good exterior presen-
tation is key. Sellers will get “a 100 per-
cent rate of return,” she says, on what
they spend on “a painted front door,
good hardware, clean windows and a
mowed lawn.” Morrison found that the
roof “looked brand new,” and needed no
attention. But she advised Barrett to
paint the entry door, deck and shutters,
repair and paint the windows, replace
the side deck stairs with smaller ones
designed to preserve more patio space,
and tidy up the yard.
And she advised Barrett t o spend most
of his $65,000 fix-up budget on modern-
izing the drab and dated kitchen and
baths. Bright, new-looking kitchens and
master baths can be buyer magnets.
Smart updates to these rooms are likely
to yield a healthy return on investment,
by raising the asking price and reducing
the time to find a buyer, thus shaving the
seller’s o wnership costs. Morrison says it
is not uncommon for sellers in Arlington
to “get back at least two times what they
spend on kitchens and baths.”
The first rule of presale home im-
provements, says Schroeder, is to do “the
minimal amount that it would take to
make the buyer want the home. Make a
list of changes that will maximize the
return.”Upgrade but keep it neutral
The second rule? Create a clean, new
look but keep it neutral. As Rubino says,
sellers need to keep their personal taste
out of the picture. Instead, they should
aim for an environment with broad ap-
peal, where many buyers can see them-
selves living.
Like many real estate agents, Morri-
son has a go-to contractor who is sea-
soned in making presale improvements.
She told the contractor how she wanted
the kitchen and baths to look, and hegave Barrett several options at different
price points to achieve that effect within
the six-week time frame. Barrett hired
painting and flooring contractors direct-
ly.
For most presale kitchen upgrades
these days, white is right. Barrett trans-
formed the kitchen with new, stainless-
steel appliances, granite counters, cabi-
nets, brushed-chrome hardware and a
stylish undermount sink and faucet
combo. Freshly painted white trim adds
a nice pop against the soft gray wall
color. Recessed ceiling lights and large
ceramic floor tiles in a light shade com-
plete the bright new kitchen.
Schroeder agrees that kitchens and
baths must be spiffed up before listing a
home for sale, but he says one bathroom
— the master bath — takes priority over
other bathrooms. “You can add nicer
countertops and a custom vanity in a
basement bath,” f or instance, “but that’s
not going to matter much to the buyer or
be reflected in a higher-offer price,” he
says.
Barrett dramatically improved the
master bathroom by replacing the old
tub with a walk-in shower wrapped in a
classy ceramic-tile surround. He
swapped the dingy vanity for a new one
featuring white cabinetry, a granite top
and a white sink with brushed chrome
faucet. A white-framed mirror, vanity
light fixture, new commode and ceram-
ic-tile floor make the room look entirely
new. More limited changes in the second
bathroom, including a glossy white tub
surround, new vanity knobs and the
removal of a cabinet behind the com-
mode, make that room feel clean and
uncluttered.
Barrett p aid Nova J unk $1,600 to clear
everything out of the house, from worn
furniture to the accumulated clutter in
every room. Co-owner Norman Eldekri
says the full-service junk removal com-
pany can remove single items, or send in
a crew to empty an entire house over a
number of hours; the fee is based on the
space filled in the company’s trucks. The
company takes some things to donation
or recycling centers and disposes of oth-
ers.Smart staging
Once the house was empty, Morrison
scheduled and paid for a professional
stager to lightly furnish and accessorize
it. As with construction contractors,
many real estate agents have stagers,
plus professionals they use regularly to
help with the decluttering and moving
process. The agents may cover the cost of
staging or share it with the seller because
they see the important role of staging in
realizing a quick sale at the best price,
says Shean Atkins, of District Home
Staging, a division of Homme Design
Collective. Generally, the staging budget
may be up to 1 percent of the listing price.
Markovist Wells, also of District Home
Staging, says a stager assesses the space
and factors in the buyer profile, then
recommends which items to keep, which
to remove (owners choose whether to