Home Improvements with Best Return on Investment
Remodel Jobs that Increase Resale Value and Ability to Recoup Costs
Sep 26, 2008
Improving your home costs money, and everyone wants to ensure that they increase the resale value of their home and ability to recoup costs. There are specific areas of a home that can be remodeled and bring the greatest return on investment. These areas include deck, kitchen, window replacements and new siding.
Although the home market value is in a state of disarray, there are certain home improvements people can make to their homes which makes the home easier to sell. This is called “curb appeal,” which is especially important in today’s online real estate industry.
Many people shop online for homes, before they follow up with an actual visit. Curb appeal is critical in online photographs. If a home appears to be rundown or in poor condition on the outside, these people will never come to see a home that may have just been completely remodeled on the interior.
Best 10 Home Improvements for Return on Investment
Every consideration should be taken regarding market value of homes in an area. Market value is the key indicator of actual return on investment and so the numbers described below are based on U.S. national averages (Remodeling Online Survey by Hanley Wood, 2008).
- Siding Replacement (Fiber Cement) – average costs are $13,212 and the return on investment is 88.1%
- Deck Addition (Wood) – average costs are $10,347 and the return on investment is 85.4%
- Siding Replacement (Vinyl) – average costs are $9,910 and the return on investment is 83.2%
- Minor Kitchen Remodel – average costs are $21,185 and the return on investment is 83%
- Siding Replacement (Foam Backed Vinyl) – average costs are $12, 132 and the return on investment is 79.7%
- Windows (Vinyl) – average costs are $10,448 and the return on investment is 79.3%
- Windows (Wood) – average costs are $11,384 and the return on investment is 79.3%
- Bathroom Remodel – average costs are $15,789 and the return on investment is 78.3%
- Major Kitchen Remodel – average costs are $55,503 and the return on investment is 78.1%
- Deck Addition (Composite) – average costs are $15,039 and the return on investment is 77.6%
Worst 5 Home Improvements for Return on Investment
These are the home improvements you need to reconsider and only complete if necessary (Remodeling Online Survey by Hanley Wood, 2008).
- Home Office Remodel – average costs are $27,193 and the return on investment is 57%
- Backup Home Generator – average costs are $13,357 and the return on investment is 58%
- Sun Room or Four Season Room Addition – average costs are $69,817 and the return on investment is 59.1%
- Master Suite Addition – average costs are $98,163 and the expected on investment is 64.1%
- Garage Addition – average costs are $82,108 and the return on investment is 64.6%
Summary
This survey’s findings by Hanley Wood are based on the feedback provided by realtors in over 60 cities across the U.S. The important point to remember is that everything is based on locality and region. For example a home backup generator has a greater return on investment in Florida than it does in other parts of the country.
Other points to consider are not to over improve your home. Any improvement which raises the selling price of your home beyond neighborhood market value is a risk. Also, remodeling work completed by a professional contractor increases return on investment.
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