Which home improvements present a better return on investment?
Frank Tarala from the Principal Brokers Network in Rochester provides the following information:
This is a topic that is regularly researched by the National Association of Realtors in cooperation with Remodeling magazine. Brokers and appraisers across the country are surveyed to provide their opinions and estimates.
Remodeling is a "rebuilding" of an area of a home with a long term outlook as opposed to a "sprucing up" which is considering a shorter term outlook. Remodeling usually considers two factors; personal enjoyment of the improvement and it's effect on the resale value of the home.
The report high-lites the top 10 mid-range projects and the top 10 upscale projects.
Inside or Outside. Where to Start?
The 2012-2013 report is clear, start outside. Six of the top ten mid-range projects and eight of the top ten upscale projects are exterior improvements and that makes sense. Outdoor projects make excellent investments because they enhance the buyers first impression of your home.
Mid-range Projects Upscale Projects
Front Door Replacement Siding Replacement, fiber-cement
Cost: $1,137 Cost: $13,083
Resale Value: $974 Resale Value: $10,379
Cost Recovered: 85.6% Cost Recovered: 79.3%
Deck, wood Garage Door Replacement, Insulated
Cost: $9,327 Cost: $2,720
Resale Value: $7,213 Resale Value: $2,046
Cost Recovered: 77.3% Cost Recovered: 75.2%
Garage Door Replacement, Uninsulated Siding Replacement, foam-backed vinyl
Cost: $1,496 Cost: $13,818
Resale Value: $1,132 Resale Value: $9,926
Cost Recovered: 75.7% Cost Recovered: 71.8%
Mid-range Projects Upscale Projects
Minor Kitchen Remodel Window Replacement, vinyl
Cost: $18,527 Cost: $13,055
Resale Value: $13,997 Resale Value: $9,295
Cost Recovered: 75.4% Cost Recovered: 71.2%
Window Replacement, wood Window Replacement, wood
Cost: $10,708 Cost: $16,361
Resale Value: $7,852 Resale Value: $11,194
Cost Recovered: 73.3% Cost Recovered: 68.4%
Attic Bedroom Addition Grand Entrance, fiberglass
Cost: $47,919 Cost: $7,088
Resale Value: $34,916 Resale Value: $4,528
Cost Recovered: 72.9% Cost Recovered: 63.9%
Siding Replacement, vinyl Deck, composite
Cost: $11,192 Cost: $34,403
Resale Value: $8,154 Resale Value: $20,532
Cost Recovered: 72.9% Cost Recovered: 59.7%
Window Replacement, vinyl Major Kitchen Remodel
Cost: $9,770 Cost: $107,406
Resale Value: $6,961 Resale Value: $64,113
Cost Recovered: 71.2% Cost Recovered: 59.7%
Basement Remodel Bathroom Remodel
Cost: $61,303 Cost: $50,007
Resale Value: $43,095 Resale Value: $29,162
Cost Recovered: 70.3% Cost Recovered: 58.3%
Major Kitchen Remodel Roofing Replacement
Cost: $53,931 Cost: $33,880
Resale Value: $37,139 Resale Value: $19,194
Cost Recovered: 68.9% Cost Recovered: 56.7%
How to Interpret This Information
This data is national and is designed to give you a gauge, not a guarantee to what return can be realized on home improvements. The mid-west region will have different costs to a project than those in the western region. The percentage of cost recovered is the best comparison statistic to use when considering an improvement, not the cost.
Top Renovations That Devalue
1) Over the top kitchen renovations.
2) Over the top bath renovations.
3) Pool or hot tub.
4) Specialized rooms.
Consult Professional, Including a Realtor
A Realtor can relate to the value an improvement adds to your life and as an investment to your homes future value. We can help establish a practical budget that includes improvements that are desirable to you without alienating future buyers.
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