What rehab improvements will maximize resale?

[Bill Briscoe]

I'm buying a foreclosure for $84K, ARV should be $125-$130K based on comps, maybe a little higher based on quality and condition. 3/2.5/2 1720 Sq Ft, 1988 construction.

The loan package consists of a 6 month IO construction/rehab loan where they will loan me 75% of estimated ARV now, then refi into a 30 yr fixed when work is complete.

The ARV is determined by the appraiser based on comps and based on a list of improvements that I intend to make. My lender told me to just create a room by room list of specific improvements that I will make. Once I provide that list, I must improve to that level or BETTER.

So my question is, what exactly should I improve and to what extent and what should I leave as-is? IOW, which items affect the appraisal the most? This is a very middle class neighborhood, some houses are well kept up and some haven't been remodeled since construction 20-25 years ago. I'd expect no one else to have granite countertops - so that would be an over-improvement, right?

My current improvement plan is:
new roof - its really old and several shigles are gone
new flooring throughout - currently concrete
new paint in and out - 50% brick/siding ext
repair siding on chimney - has rotted away due to water damage
new water heater
new AC/Furnace
repair sheetrock water damage from plumbing leak
replace kitchen appliances
landscaping
replace garage door - wood rot

optional items would include:
replacing various fixtures - which ones?
new kitchen countertops - currently formica - use newer formica? something else cheap?
replace 2nd bath tile (dirty) with bathtub insert
replace master shower (currently cultured marble?? - dated looking) with fiberglass insert
there is a jaccuzzi tub in master as well - not sure if it works - would it hurt value if I pulled it out and put in shelving?
pouring a 12x8 concrete patio in back - currently it is a wood deck raised 4 inches off the ground under a covered porch. Does not look new.

So basically, what improvements/materials give the most bang for the buck in this type of neighborhood? I can link to pictures if that helps.

The goal is to sell as a lease/purchase with a backup plan of keeping as a longer term rental. So I will have this for a couple years, maybe longer.

[John Moore]

I would suggest you speak directly to a local Appraiser and see what rocks their boat. In my area often times you can put in a high grade window and get no financial credit for it. Granite in this my area you just about recover the actual cost; Architectural Shingles you gain a little ground. If the jetted tub works I would leave it in place, why incur additional expense. Jetted tubs are a turn on even though they are not utilized as much as people imagine although they set the mood for some prospects. Attractive kitchen cabinets, lighting and stainless steel appliances seem to get more bang for the buck Garage door opener you will recover the cost and it will help you with potential prospects, improving the garage may get you some additional consideration from the appraiser and the prospect. Laundry facilities are important to most families, closet and storage space. My suggestion is to make the home as attractive as possible within the budget you allocated. Sorry I wasn't specific on what would give you the most bang for the buck you will find that the appraiser will use his experience in the neighborhood and bring your property in at a level reflected by the quality of improvement over similiar properties.