New formula that helps you evaluate the value of your home improvements!
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It's not often that home renovations turn scientific. When it comes to understanding whether the improvement adds value to your home or not, we've often relied on common sense and our own ways of rationalising the renovation.
But Dr David Holmes, a professor from Manchester Metropolitan University, wasn't satisfied with a gut feeling, a rationalisation, or even common sense. He devised a formula to empower homeowners to make 'rational and informed decisions' about the value that improvements will add to your home.
His formula is:
VA = (ED + Q + P + S - AI) / 2
- ED = Enhancing design. Does the improvement align with the rest of your home?
- Q = Quality of workmanship. Is it a quality job or a shoddy one?
- P = Practicality. Will the improvement be useful to someone who buys the home?
- S = Saleability. Does the improvement impress potential buyers and increase the likelihood of a sale.
- AI = Amount Invested - the cost.
Dr Holmes' formula solidifies the usual advice about home renovations that don't add value and puts it into perspective. If your VA score is less than 5%, you might as well not bother. 6% means the renovation will pay for itself but nothing more, and 7% and above means that the renovation adds value to your home and will result in more cash in your pocket in the event you want to sell your home. The formula works no matter which country you're in - only the amount invested will fluctuate.
He points out that the value of the home is made up of two things - the net value of the property, and the desirability of it. We love his advice because he's fully behind the idea that poor workmanship undermines the value of your home, and decreases the effect of the renovations.
Service Central is all about connecting quality tradies with our consumers - and not the cowboys. Nowhere is the speed of the job mentioned as something that affects the value, and the cost (while involved in the formula) is put into perspective with the value and purpose statements.
Service Central has put together 6 home improvements that will definitely add value to your home - why not put them to the test with the formula?
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Just what figures does one need to put in to get a valid result?
over a year ago by Lex Graber
Only the Paid price seems to be a known value in this highly suspect equation...
If you google this professor/psychologist/animal behaviourist and general media junkie, his various findings/credentials do not seem to inspire confidence... -
once again, another academic just proving that you don't need a long neck to be a GOOSE!
over a year ago by CTP
Renovation Quotes
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