How to Make Money on Your First Home (and your second, third, fourth...)

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If there's one thing I feel VERY strongly about, it's making sure that my clients - both real estate and design - do everything they can to make money when they sell their home. I probably sound like a broken record, because I'm constantly talking about the same thing. BUT it is, quite literally, the mission of my business, so I'll give myself permission to continue.

Why do I care so much, and some background

First, this: REAL ESTATE IS AN INVESTMENT, FIRST AND FOREMOST, AND YOU NEED TO TREAT IS AS SUCH IF YOU WANT TO REAP THE REWARDS.

Yes, I will continue using all caps to say that. Every time.

"But it's my home and I love it so much," I hear you say. And "I'll never move again" which is usually not true. And I get it. You love your home, you can't imagine ever leaving, and perhaps you just moved in, so selling that home is the last thing on your mind.

But as I've said before and will continue to say over and over (and over) again, things change and you should never say never. What I don't want is for you to go into home ownership thinking that you'll be in the same home for 30+ years and that you have "plenty of time" to do all the things you want to do to your home.

Don't get me wrong... you might stay in the same home, but I'm finding that the younger generations are much more transient (not in a bad way), adventurous and non-traditional than our parents, so chances are that you will move more than once, and if you're even a little bit like me, you may even move six, seven, eight+ times in your adult life.

So, back to the main point. My #1 goal is for you to make money on every home you ever own, no matter what - market conditions, interest rates, length of time you lived there, etc. But since it's best to start strong, I'm going to give you my top rules for making money on your FIRST HOME. And then you can use the same rules every time you buy & sell.

"THAT ONE HOUSE"

In every market, every season, [mostly] every price point, there is ALWAYS THAT ONE HOUSE that sells super fast, gets multiple offers, and closes WAY above asking price. I've seen it time & time again, and I've worked in multiple real estate markets in several states, and I've lived on both coasts of the US. Without fail, this happens literally everywhere.

I've been "that house" before, and I want you to be "that house" too.

My experience:

• I purchased my first home in 2005 and sold it in 2013 for 15k more than I paid

• I purchased my next home in 2013 and sold it in 2016 for 45k more than I paid

• I purchased my next home in 2016 and sold it in 2021 for 174k more than I paid

• I purchased my next home in 2021 and sold it in 2022 for 51k more than I paid

• I built a house in 2021 and sold it in 2024 for 500k more than I paid  

The first two homes I sold, I kind of just got lucky. I didn't really know much about home ownership and definitely didn't have a plan. I just replaced things when they stopped working and made updates when I could afford it. But then in 2016, I started working in real estate and learned a LOT about buying & selling homes.

Here is my step-by-step guide to making money on your first home:

There are three categories you need to pay attention to if you want to make money when you sell your home:

1. Basic maintenance (the boring, but necessary, part)

2. Cosmetic updates (the fun part)

3. Staging to sell

Obviously, basic maintenance and cosmetic updates are the two categories you need to pay attention to while you are living in your home, while staging to sell comes in just before you list.

HINT: If you do #1 and #2 correctly, then #3 becomes SO MUCH EASIER when the time comes.

1. BASIC MAINTENANCE

   
   

Ideally, you will have a home inspection before you buy. During your home inspection (or before, if the listing agent is really good), you will want to gather the "ages" of the major systems and components. Basically, write down the year of installation for the following:

• HVAC (inside unit & outside unit)

• Hot water heater

• Roof

• Windows

• Doors

• Appliances

• Plumbing updates (if house is older)

• Electrical updates (if house is older)

• Well components (if applicable)

• Septic system (if applicable)

Now, use this resource from the International Association of Certified Home Inspectors to see the typical "life expectancy" of the major systems.

Generally, replacement of these major systems/components will be your biggest expenses, so hopefully, your new home will have updates to at least some of these major systems.

***PRO TIP: I always opt for a home with more major systems updates vs. more cosmetic updates.

A note about return on investment (ROI) and systems updates: Unfortunately, there is really not a great ROI when you replace one of these major systems. Sad but true.

The way you need to think about it is maintaining your investment vs. decreasing the value of your investment. So for example, if you go to sell your home and your roof is 30+ years old, that fact is going to detract from the potential value, or asking price, of your home, and therefore will yield you less money. Conversely, if you have a roof that's only a few years old, that is going to allow you to hold the value and perhaps push the upper limit of your asking price range.

So with each major system replacement you pay for while you own your home, you need to think of it as necessary maintenance, similar to car maintenance. Not fun, but necessary. (Back to the fact that I always opt for a home with more major systems updates vs. more cosmetic updates when I buy).

Here's the best strategy for extending the life of your major systems so that you know the condition of each system and can budget for replacement cost, if necessary.

Two options, but ideally do both:

1. Create and stick to a monthly home maintenance schedule as soon as you move into your new home. Grab my 12-month freebie here or go for the full, ultimate home maintenance guide here for only $14.99.

   1. Keep impeccable records for your home. Create a home maintenance binder and put everything in there.

2. Purchase (or have the sellers purchase for you) a comprehensive home warranty, which will cover most of your major systems, but always check the fine print. The home warranties I've used do NOT cover the roof, windows or doors, but you should ask your realtor or inspector for advice.

By keeping a close eye on your major systems (with a monthly home maintenance plan), you'll be far less likely to have surprises, which typically means costly, unexpected repairs. Which leads my to my next point...

Do NOT be house poor. Make sure that you keep a significant savings while you own your home. If this means putting less money for your down payment or opting for a lower priced home, then you should probably consider that (speak with your lender first, of course). Because remember, your home is an investment that needs to be nurtured in order to grow in value, so you will need money in the bank!

Other thankless maintenance projects to consider:

• Driveway repaving or sealing

• Gutter/downspout replacement

• Exterior drainage

• Basic landscaping

• Exterior wood replacement (trim, decking, etc.)

• Basement waterproofing

BOTTOM LINE: Plan to spend some money on boring, thankless systems updates while you are living in your home if you want to make money when you sell.

2. COSMETIC UPDATES

   
   

   

   
   

Now comes the fun part! You've taken care of your major systems, so it's time to move onto cosmetic updates. This is obviously a HUGE category, so I'm going to break it down as much as I can.

If you want to make money when you sell your first home, you will likely need to make some cosmetic updates. But where to begin? Which projects have the biggest ROI? How much should you spend?

I'm going to break it down by price & level of impact:

$$$ MAJOR PROJECTS FOR HUGE IMPACT

$$ MODERATE BUT QUICK FOR BIG IMPACT

$ BUDGET FOR SOME IMPACT

So obviously, your budget is going to dictate the projects you'll be able to complete, so my suggestion is to set a schedule for yourself at the beginning of each year.

For example, your schedule could look like this:

Quarter 1 - complete 1 moderate project

Quarter 2 - complete 3 DIY budget projects

Quarter 3 - skip, save for Quarter 4

Quarter 4 - complete 1 major project

Major projects for huge impact ($$$)

• Full or partial kitchen renovation

  • A note about cabinetry: Choose shaker or traditional style, warm wood tones or white/cream, NOT gray.

  • Regarding appliances: PLEASE choosing matching appliances (i.e. the SAME brand). Nothing screams a cheap, piecemeal kitchen like mismatching appliances.

• Bathroom renovation

  • If you don't have to reconfigure, a bathroom renovation can be more affordable. Think: new vanity & hardware, new lighting, new tile, etc.

    • I always like to add something super fun and stylish to my bathrooms, like:

      • Wallpaper

      • A unique tile or tile pattern

      • A fun wall color

      • An interesting vanity cabinet

• New flooring

• Exterior hardscaping

• Major reconfiguration of rooms or living areas

• Basement finishing

Moderate but quick for big impact ($$)

• Interior/exterior painting (professional)

• Painting kitchen cabinets

• Adding moldings

• Adding recessed lighting

• Adding accent lighting (above or under cabinets, inside of built-ins, etc)

• Adding a stylish stair runner

• Redoing interior railings or banisters

• Improving closets and storage space with shelving, built-ins, etc.

Budget for some impact ($)

• DIY painting

  • Always touch up your trim paint, including doors, moldings, etc.

• Swapping out kitchen/bath cabinet hardware

• Swapping out kitchen/bath plumbing fixtures (DIY if you're handy)

• Swapping out light fixtures (DIY if you're handy)

  • Remove ALL SIGNS of builder grade lighting if applicable (IYKYK)

• Adding peel & stick wallpaper

  • Start small, like a powder room or foyer

• Adding window treatments

  • Layered, for bonus points (i.e. woven blinds and draperies)

Again, your budget is going to determine how many projects you are able to do each year, but the best advice that I can give for ensuring you make money when you sell your home is to focus on the rooms/features that stand out the most in your home.

Here are some examples:

• If you have a beautiful foyer, but it's totally blah and builder grade, then maybe one of your $$ projects could be to freshen up that space.

• If the layout of your kitchen & family room doesn't make sense, then maybe one of your $$$ projects should focus on improving that space, whether that means removing a wall, or widening a doorway, or whatever makes the most sense for your space.

• If your light fixtures are all builder grade or just plain ugly, choose one or two to replace per year, per season, or per month, depending on your budget. This can easily be a $ project if you shop smart for your fixtures, you're handy and can DIY, or you have a great electrician who charges a reasonable rate.

Some other general things to consider when deciding which projects to complete:

• Erase all signs of builder grade materials & finishes as soon as possible. Typically, these are easy/moderate swaps that make a huge difference and can change the overall feel or your home from generic to custom.

  • Here are the most common builder grade finishes to erase from your home:

    
    

    

    
    

    

    
    

    

    Photo credit here

    
    

• If you have an older home, try to maintain the integrity and character with your renovations (i.e. don't go super modern and sleek on a kitchen in a 100 year old home).

• Please, only DIY if you have that capability. In our house, I know that my main DIY capability is painting, and my husband's is, well... you get the point. So be sure to work within the realm of your expertise so you don't have to hire someone to fix what you've attempted :)

3. STAGING TO SELL

   
   

The final - and crucial - step to guaranteeing that you make money when you sell your home is staging. Obviously, this will be done just before you list, and like I mentioned before, if you do steps 1&2 right, this step should be a breeze.

Here's my step-by-step guide for staging to sell so that you can make money on your home no matter the type of market:

1. Before you do anything else, you need to separate yourself from the home you are selling. This is SO important. Picture yourself already living in your new home so that you can objectively make the necessary changes to your current home that will appeal to the largest number of buyers possible.

2. Clear 90% of your surfaces. That includes kitchen & bath counters, tables, nightstands, dressers, desks, etc. Only keep stylish and simple items on your surfaces, and make sure the items are the correct size for the space (i.e. don't place a tiny bowl on a large island in a kitchen with super high ceilings).

See the photos below from some of my past listings, and take note of the surfaces:

3. Remove excess furniture. Too much furniture (or too large furniture) can make a space feel much smaller than it actually is, so please take an inventory and remove it before you list your home.

4. Make sure every single light fixture in your entire home has a working light bulb, and that the wattage & level of warmth are the same throughout the room and fixture. PRO TIP: Always choose soft, warm light bulbs, NOT cool/daylight bulbs.

5. Purge and organize all of the following:

   1. Your pantry

   2. All your closets

   3. Your kitchen drawers

   4. All your cabinets - kitchen AND bath

   5. Your storage areas

6. Clean your home compulsively from top to bottom.

7. Make sure your entryway/foyer is impeccable & stylish.

   
   

   

   
   

8. Style all your beds

   
   

   

   
   

9. Power wash, mulch, and add planter pots or lanterns to your front porch.

10. Remove all small area rugs (2x3 and smaller).

11. Magic erase wall scuffs & touch up trim paint in high traffic areas.

12. Simplify the decor on all bookcases, shelving, and mantles. This can look REALLY cluttered in photos, so you want these to be simple & stylish.

    
    

    

    
    

    13. When in doubt, choose blue as an accent color. I'm not exactly sure why, and maybe it's the psychology of the color blue, but I am convinced that the majority of the "hot" properties that sell fast with multiple offers use the color blue in their design. Blue and natural, blue and white, blues and greens... those colors just photograph beautifully.

    
    

    See examples below from some of my past listings:

    
    

    

    
    
    
    

    

    
    

14. Take the advice of your real estate agent when it comes to staging your home. Your agent may be experienced with staging, or may bring in an expert, but NO MATTER WHAT - make sure that your home is perfectly styled and staged before you list it for sale and always keep the ultimate goal in mind: make as much money as possible on the sale of your first home (and your second, third, fourth...)

    
    

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Reach out for more help with maintaining your home for the ultimate return on your investment: stacy@stacywardhome.com