Whether you have a sudden windfall or your current home is no longer meeting the demands of your household, most homeowners consider a remodel at some point. Unless there’s a specific issue like the need for a second bathroom or an extra bedroom to accommodate a new addition to your family, some improvements are a matter of want rather than need. However, few of us are in a position to go purely for whimsy over value, so getting a good return on our investment is also an incentive.
The best returns are for improvements that have a wide appeal over the spectrum of property owners. These include improving energy-efficiency or upgrading kitchens and baths. If you’re looking for a good ROI on your home remodeling investment, here are the top five to consider.
New Siding
The average vinyl siding upgrade costs about $9,000 and can add almost $8,000 to the value of your home. That’s a return of 90%.
Complete Bathroom Renovation
This usually entails more than just putting in a new bathtub or laying down new tiles. A complete bath overhaul means upgraded plumbing and putting water- and energy-saving facilities in place. The average cost is around $13,000, but you’ll add almost $11,000 to the value of your home, giving you an 85% increase. However, adding a second bath does not increase the value of your home as much as remodeling the main bath.
Replacing Windows
This one isn’t very sexy or obvious, but it comes in number three for ROI. Upgrading to energy-efficient, easy to care for vinyl windows cost about $10,000 for the whole house, depending on the size of the home. However, you’ll increase your resale value by about 85%. Even if you’re not planning to sell anytime soon, you’ll still put more money in your pocket through lowered heating and cooling costs.
Kitchen Remodel
This one is usually number one on many property owners’ wish list, but it comes in fourth for ROI. The basic components usually added are new stoves, flooring and upgraded appliances. However, a major upgrade can cost up to $81,000 and bring you an 81% return.
New Roof
This a definitely a long-term investment, and one of the first things prospective buyers will want to know about if you put your home on the market. A new roof carries a two-year warranty on labor and anywhere from a 20-year to lifetime warranty on materials. On average, a new roof will run you about $14,000 and add about $10,000 to the value of your home. That’s an ROI of 75%.
Honorable Mentions
These are upgrades that are less practical, but still, offer a return of more than half of their cost. They include new landscaping, decking and basement conversions.
Value is sometimes a relative term. Your home remodeling goals may be different if you plan on living in your home for a number of years than if you’re selling in less than two years and want to recoup your investment immediately. When you’re ready to embark on a home improvement, you can get free remodeling quotes from most contractors. It’s best to get quotes from at least three companies before you decide on a builder.