Q. My house needs massive improvements. Stuff works, but it’s ancient. I plan to retire in two years and move elsewhere. Is it worth doing repairs or should I just sell it for less because it’s older than I am?
— Planning ahead

A. Spending big money on home improvements is never an easy decision.

Your personal financial situation should be the first consideration.

Start by working with a real estate agent that you trust to get some information on the local real estate market and comparable houses for sale and houses that just sold, said Michael Cocco, a certified financial planner with AXA Advisors in Nutley.

“If there is a strong real estate market and the house is in good location, one should give some thought to updating bathrooms, kitchen and landscaping, as those tend to give you thebest return on investment when selling a home,” Cocco said.

But if you’re short on cash, this may not be an option.

Cocco said while it would be great to get a better price for your house, if you spend almost all of your cash or are forced to liquidate retirement funds that may be taxable to use for the house improvements, you may be short-changing yourself at retirement.

Now, if the improvements you need are more than cosmetic, or even if your home looks very run down, it may be a turn-off to buyers.

“A house in disrepair can immediately drive away buyers who cannot see past the repairs that need to be made,” said Gerard Papetti, a certified financial planner and certified public accountant with U.S. Financial Services in Fairfield.

He said you should make a list of all the items in need of repair.

“Some items are purely cosmetic and other items are more critical such structural and/or mechanical items,” he said. “Once you have the list you need to prioritize those repairs.”

To figure out the priorities, consider that a home inspection will uncover many items that the inspection company will report to the potential buyer — both the critical and non-essential repairs that should be made, Papetti said. If you don’t address those now, you’ll have to do it when the house is listed for sale.

“Critical repairs you will need to be made or you will need to reduce the sales price to account for the estimated cost of the repair,” Papetti said. “If you make the repair prior to listing the house for sale, you may be able to have it done at a more reasonable price than if under the pressure of a home inspection.”

The fewer repairs a house needs, the more the buyer is likely to focus on your home and not on the negatives of all the word that needs to be done.

Also, real estate agents will often give more attention to a well-maintained home because it’seasier to sell, Papetti said.

And getting those essential repairs done first will mean you’ll face less pressure to reduce your asking price.

Your timeframe if retiring in two years gives you a decent amount of time to make improvements in stages, Cocco said. He recommends you start with the ones you believe would give you the best impact, and then move down your list.

“If you don’t get to all of the improvements in your `wish list’ for lack of time, money, energy, that is okay — you at least did something to improve the potential sale value of your home,” Cocco said.

Karin Price Mueller writes the Bamboozled column for The Star-Ledger and she’s the founder of NJMoneyHelp.com. Click here to sign up for the NJMoneyHelp.com weekly e-newsletter. Like NJMoneyHelp.com on Facebook and follow it on Twitter.

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