According to Remodeling Magazine (source: http://www.remodeling.hw.net/ ) there’s a smaller chance of recouping the remodel return on investment you made in a kitchen or bathroom remodel than you can get back on what you can spend on a basic home maintenance project such as new siding. According to the study, siding replacement recouped 92.8 percent of its cost. A minor, roughly $15,000, kitchen remodel is the only home improvement that is likely to return or recoup more at resale, it returned 92.9 percent. With a return of 80 percent or more at resale, roof and window replacement were also at the top of the list. TGUC Financial can help you find a remodeling contractor as well as assist you with financing your remodel.
There’s No Added Value from Maintenance
First things first, do keep in mind the difference between home maintenance and home improvements. Basically, maintenance is replacing old or broken things with new ones, while improvement is enhancing the appearance regardless of whether it is broken or still functional. For instance, replacing your old and broken furnace will not add up to your home’s overall value. It just makes your home sellable in the market.
However, installation of dual-pane windows for increased heating efficiency does add value since buyers can benefit from the improvement in lower heating costs.
The Top Interior and Exterior Improvements
Remodeling Magazine annually releases a cost vs. value report which examines remodeling costs together with the resulting increase in home value at resale. This is to determine which projects offer the best return on investment. Among the 22 home improvement projects in the 2020 report of Remodeling Magazine, 7 out of 10 of the best nationwide returning jobs included the exterior part of the home.
- A manufactured stone veneer was the best-performing project. It had an average cost of $9,357 and an average increase in home value of $8,943, for a return of 95.6 percent.
- Garage door replacement was in second place. It returned an average of 94.5 percent. The average cost was $3,695, while the average return on home value was $3,491.
- A minor kitchen remodel in a midrange home ranked the highest in interior remodeling jobs. It had an average cost of $23,452 and an average return of 77.6 percent, increasing value by $18,206.
- The next highest returning in interior remodel was a vinyl window replacement. It returned an average of 72.3% after costing $17,641 and increasing value by $12,761.
Effect of Paint Colors on Resale Price
Choosing the colors of the paint to be used inside and out of your home makes a huge difference in your home’s value at resale. Painting affects your home’s value as it either increases or decreases your home’s visual appeal to potential buyers, which can also affect the result of a lower or higher offer.
The Zillow paint color analysis took a look at the effect of different paint color choices in every part of the house on the actual sale price of the home in comparison to its estimated value.
The analysis came up with some unexpected conclusions. For example, a pink taupe as the best color for a living room can increase the home value by 2.9 percent, while a black-painted front door increased a typical United States home’s sale price by 2.9 percent. On the other hand, a kitchen colored in brick or barn red decreased the overall home value by $2,310.
Kitchens and Bathroom Remodel Return on Investment
Most long-time homeowners feel the need to refresh some parts of their home, especially the kitchen and bathrooms, before putting their house up for sale if those rooms remain the same throughout the years. These remodeling projects seem to pay off more in the homeowners’ pride while still residing there than they do in recouping value at resale, especially those houses that are expensive.
According to the cost vs. value report, only 64 percent was returned out of an average investment of $21,377 for a bathroom remodel in a midrange home. While for an upscale home, the return was even worse with 56.6% return in an average cost of $67,106.
The same happened with kitchens, only a return of 58.6 percent came from a major kitchen remodel in a midrange home with an average investment of $68,490. Then a major remodel in an upscale home was the worst among the four projects with an average of 53.9 percent return on investment based on a typical project cost of $135,547.
The real value in those house remodeling projects comes from the enjoyment you get out of having them done. If you’re not planning on permanently settling in your home, you may want to think twice about considering a bathroom or kitchen remodel.
Average Remodel Return on Investment
Below is a table of the average remodeling cost recoveries according to Remodeling Online.
|
Renovation/Remodel |
Average Cost Recovery |
| Wood Deck Addition | 80% – 85% |
| Siding Replacing | 75% – 83% |
| Minor Kitchen Remodel | 75% – 83% |
| Window Replacement | 75% – 80% |
| Bathroom Remodel | 70% – 78% |
| Major Kitchen Remodel | 70% – 78% |
| Attic Bedroom Remodel | 65% – 76% |
| Basement Remodel | 65% – 75% |
| Two-Story Addition | 65% – 74% |
| Garage Addition | 60% – 70% |
TGUC Financial Can Help You With Financing
TGUC Financial can help you find a remodeling contractor as well as assist you with financing house addition cost. Contact us today.
Recent Comments