3-Bedroom Vs. 4-Bedroom Home Value: What Is The Difference?

At what point does it make more sense to steal space from the fourth bedroom in your home to take advantage of that additional square footage? Or, perhaps you’re considering squeezing in a fourth bedroom in an attempt to raise the value of your home.

To phrase things a but little differently, what is the difference in terms of home value for a three-bedroom vs. a four-bedroom with the same square footage? According to research collected by Laura Abramson from Keller Williams, it makes a marginal difference to convert a four-bedroom home into a three-bedroom home when the home is on the smaller end of the spectrum. However, there is a threshold in home size where a fourth bedroom can offer a premium.

Ultimately, the value of a 3-bedroom vs. a 4-bedroom home comes down to the square footage, as not all square footage is created equal. It largely depends on what you plan to do with the additional space. A buyer may see a lot of value in a larger master bedroom or a second-floor laundry room. Whereas, buyers may see little value in the fourth bedroom being converted into a custom closet if there was already adequate closet space to begin with.

With that said, let’s take a deeper look at the differences in terms of value between a three-bedroom and four-bedroom home. We’ll also explore how much value an additional bedroom can bring to a home in general.

Many property investors begin by adding a second, third, or possibly even fourth bedroom to the home that they are flipping. Of course, this move depends on the size of the property and the investor’s budget. However, you might be wondering why they do this and is it a smart move to make?

Well, real estate experts claim that adding a new bedroom to a house could increase the overall value of the property by as much as 15%. This can make a major difference in the final asking price for a home. In fact, for every bedroom added onto a property, the homeowner or investor can see the property value increase by as much as $30,000 to $50,000.

While this may be what real estate experts estimate, the actual increase in value will depend on the specifics of your particular real estate market. So, there isn’t really a one-size-fits-all answer. In fact, the only true way to know how much you will expect to get for an extra bedroom is to speak with a local experienced realtor. With that said, here are some considerations you should make before adding an extra bedroom to your house to increase value.

Although many homeowners attempt to expand their homes by converting excess spaces into bedrooms, this often has a 50-50 chance of adding value. For instance, some people might love the idea of a finished basement bedroom, while others may not see any value in it at all. However, the attic or loft in your home is usually a great place to start when you want to add an extra bedroom.

Depending on the design of your house, converting a loft into a bedroom may be as easy as adding in a staircase or as complex as rebuilding walls. The most important factor in this type of conversion is to ensure that the height of the ceiling is appropriate for a livable space. Attic space is usually a very useful bedroom space, provided that you can stand and it is easily accessible via a permanent set of stairs.

The cost to convert a loft or attic space into a bedroom will depend on the location, scope of the project, and the real estate market, though it’ll likely be somewhere between $12,000 and $50,000. When compared with the average cost of constructing an extra bedroom from scratch – starting at $57,000 – a loft bedroom conversion is a more cost-effective option.

Quick Tip: Keep in mind that a renovation project like this will likely require licenses, permits, and permissions from local building code and HOA. Never avoid this step because without meeting the right codes, the loft or attic space may not be allowed to be listed as a bedroom and all your hard work will be null and void.

Not all square footage is created equal. While you might expect that the more bedrooms you have, the higher the selling price of the home. However, this isn’t always the case. The question of whether a three-bedroom home or a four-bedroom home has a higher property value comes down to the square footage and how it’s used.

On paper, a four-bedroom home may sound more valuable, but the three-bedroom home could have a larger living room or possibly a bigger master suite – which is very desirable among potential buyers and makes it a contender for the four-bedroom. In order to provide a more accurate analysis, the following charts compare average sale prices of 3-bedroom vs. 4-bedroom homes, based on size, in Livingston County, Michigan.

If you’re thinking about adding an extra bedroom to your house or converting your fourth bedroom into something else, it’s best to speak with an experienced realtor before you begin any work. For a home that is already small as it is, adding an extra bedroom could create tiny bedrooms that are undesirable from a potential buyer’s standpoint.

It can be expensive to furnish a 3-bedroom house. Whereas, a small four-bedroom home could greatly benefit in terms of space from being demoted to a three-bedroom.