May 29, 2024

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These 7 Major Home Renovations Add Value

Whether you're preparing for a move or simply looking to update your home, remodeling can be a huge undertaking—so it's important to know whether the reward will be worth the effort. Knowing which renovations will yield the highest return for your money is key, so that when it comes time to sell, you can demand a higher price. Ultimately, you'll want to make the best home improvements to add value to your home. Before you decide on a remodel project, evaluate its cost versus its value, and decide if the renovation you want to do is a worthy investment of your time and money. So what renovations offer the biggest impact on a home's value? Six Better Homes & Gardens Real Estate experts weigh in on which projects are actually worth taking on. Here are the best home renovations for potentially raising the resale value of your home.

Helen Norman

1. Create an Addition

As your family grows, why shouldn't your home? Consider building an addition to add major value to your home and increase square footage. Maximize your investment by selecting the perfect materials and details to enhance your home's value and character. "Any kind of physical expansion—whether it's a new bedroom, an extension of a living room, or whatever space you desire—has a huge impact," says Joe Rand, managing partner and general counsel at Better Homes & Gardens Rand Realty. "If you can add square footage to a house, you always add value. Size matters!"

Emily Followill

2. Redo Your Kitchen

The kitchen is the hub of the home, so functionality is a top priority. Remodeling a kitchen can be exciting and satisfying, especially when it's designed to meet your needs and desires. According to the National Association of the Remodeling Industry's 2019 remodeling impact report, Realtors estimate that homeowners can recover up to 52% of the cost of a kitchen upgrade upon selling the home.

"Updating the kitchen with new appliances and bathrooms with new plumbing fixtures may seem trivial, but it's a must," says Brad Carlton, sales associate at Better Homes & Gardens Real Estate Metro Brokers. "Currently, there are many kitchen features that are trending in the Atlanta area, such as wine refrigerators, drawer-style microwaves and dishwashers, commercial-style ranges, and hidden outlets."

Annie Schlecther

3. Renovate a Bathroom

An updated bathroom is a major selling point for any home. When renovating, incorporate sleek surfaces for a sparkling space that makes cleaning a cinch. According to the same report by the National Association of the Remodeling Industry, Realtors estimate that homeowners can recover up to 57% of the cost of a bathroom renovation if they sell their home.

"If a home has only one bathroom or at most a one and a half bathroom, adding a shower to a half bath, or adding a half bath to a living area for guests immediately improves the appraised value of a home," says Jody Steinberg, Realtor, LaVista Hills Team, Better Homes & Gardens Real Estate Metro Brokers.

Helen Norman

4. Update Your Home’s HVAC

Your home's heating, ventilation, and air conditioning (HVAC) are the components that keep everything operating. These are some of the most critical items to maintain. In addition, Realtors estimate that homeowners can recover 85% of the cost of a HVAC replacement if they sell their home.

"Buyers are often taken aback when, upon inspection, a home's heater, air conditioner, and roof are found to be old or in poor shape," says Derek Whitner, Realtor, Team Whitner, Better Homes & Gardens Real Estate Metro Brokers. "Studies have shown that millennials are unwilling to overlook old mechanicals, even if the seller is offering a home warranty as a way to compensate for the age of these systems."

Keller and Keller Photography Inc

5. Amplify Outdoor Living Space

Nothing beats the option of entertaining outdoors. An outdoor living space will make your home a relaxing destination for get-togethers and add major value. No matter your budget, there are plenty of ways to update your backyard, porch, or patio.

"Tap the outdoors for extra living space," says Mary Hutchison, senior sales executive, Better Homes & Gardens Real Estate Kansas City Homes. "In the old days, just about everyone had a front porch or screened-in area to shade themselves from the Midwestern heat, and these classic features are still in demand. A screened-in porch or backyard patio—especially one that includes an outdoor kitchen with a built-in grill and small fridge—makes a wonderful additional entertaining area."

Michael Garland

6. Make Your Home More Accessible

Home renovations should be made with universal design principles in mind. That means creating a space for people of all ages, sizes, and physical abilities. Take careful inventory early in the planning process of all intended users' capabilities, preferences, and tastes.

"If it is possible to make your home more accessible, your home will be more welcoming to guests, more marketable to the largest audience, and best of all, you will be able to age in place," says Steinberg. "Do this by widening doorways, changing a main-level tub to a shower, clearing a path to a stepless entrance, or by adding a door to the back or side of your house."

7. Update Your Light Fixtures

Lighting is one of the simplest renovations that will add value to your home. You'll be amazed by how well-placed pools of warm light can make your home inviting and user-friendly. Consider the design, as well as function, when choosing the right light fixtures for your rooms.

"Updated styles of interior and exterior light fixtures are readily available at big box stores and online retailers for a bit of pocket change," says Robin Wolfram, Realtor/designer at Better Homes & Gardens Real Estate All Seasons-Rochester. "It can provide the big wow factor many homes would otherwise lack. If shopping online, be sure to look for any 'open box' pricing: an undamaged item that was returned simply because someone changed their mind."

5 Outdoor Upgrades That Add Big Curb Attraction

They say you should not choose a e book by its cover, but when it will come to your residence, outward appearances make an undeniably forceful to start with perception. And although simple aesthetic updates—a fresh coat of paint, a new set of shutters—can surely go a long way, some considerate investments can maximize your home's value and suppress attractiveness.

The very best exterior house upgrades strike a equilibrium amongst affordability and return on financial commitment, creating extended-long lasting value that will raise in excess of time. For case in point, changing old siding with a product that capabilities the hottest technological improvements, such as Hardie Panel fiber cement siding, can both equally generate a striking transform to the facade's visual appeal and aid increase its all round toughness and temperature resistance. And particular forms of created additions, like outside kitchens and screened-in porches, can considerably maximize your offered dwelling place (and house value), with no the trouble of intrusive inside renovations.

Read on for far more on our outside-improve thoughts that can generate true, very long-expression benefit for your home.

house with vertical siding

James Hardie

Facade facelift

There is small that alters the look of your house far more radically than an fully new exterior, regardless of whether you might be inspired by the common Hardie Plank lap siding, (a solution backed by the Fantastic Housekeeping Seal) or are additional drawn to a vertical style and design. The brand's higher-functionality fiber cement solutions are a extended-lasting and sustainable choice to classic wooden or vinyl paneling, meaning your financial investment will be well really worth it in the long run. Contrary to wooden, the material is fire-resistant and pest-resistant not like vinyl, it truly is incredibly strong and will not crack or warp in intense weather conditions. And thanks to James Hardie's large assortment of products—as perfectly as the wide range of structure-savvy colors and textures they're available in—there's a little something for each individual fashion of dwelling, from Hardie shingle siding for a Cape Cod–style cottage to substantial Hardie Architectural Panels for a up to date 1.

large wooden deck of home

EricVega//Getty Images

Decked out

Who would transform down a new out of doors residing room? Setting up a deck or a patio will increase your all round living room while incorporating an eye-catching new layout component to the exterior of your house. An elevated deck will protect your green place, when a paved stone patio lets you produce a organic-emotion setting that suits in seamlessly with the relaxation of your landscaping. Depending on your perseverance to the vibe, you may even contemplate developing a screened-in porch, comprehensive with a ceiling admirer, lights, and seating.

a grill with hot dogs

James Hardie

Further than the grill

It isn't going to get a large amount better than dining alfresco on a warm evening—except maybe if you can do all the cooking exterior much too. And even though hovering above a grill is all fantastic and superior, a comprehensive-assistance out of doors kitchen will include yet another amount of appeal to your property, specially for those who love to entertain. Durable stone countertops, composite or stainless cupboards, and crafted-in appliances make for a functional exterior area that will allow you to expend time with your friends fairly than frequently heading back indoors to check on things. Look at installing a designed-in wood-hearth grill for searing steaks in style—or even, for the genuinely formidable, commissioning a customized brick pizza oven.

beautiful spring garden plants in may in babylon, long island

Vicki Jauron, Babylon and Past Images//Getty Visuals

Eternally friends

Planting a yard crammed with extended-lived, minimal-servicing perennials is a somewhat basic way to dramatically remodel the exterior of your household. For each and every hardiness zone (test below to come across yours), there are a huge selection of plants that will return year soon after yr, escalating extra and a lot more spectacular as they experienced. Colourful bloomers like daylilies, hostas, and coneflowers will prosper in most zones, or you can choose for foliage-concentrated crops like holly, smoke bush, or burning-bush shrubs, which convert a brilliant crimson every autumn.

a pool with a building in the background

James Hardie

Pooled resources

If you have bought the space and can manage the maintenance, even the humblest swimming pool, whether or not crafted-in or above-ground, can translate into a significant residence-price boost. It can be a considerably-sought-following amenity for many possible household buyers—and in the meantime, you won't regret the summers invested taking pleasure in it with relatives and close friends. If you currently have a single, take into consideration incorporating linked luxe amenities—like a cabana, scorching tub, or out of doors bar—to make the most of your poolside authentic estate.

What Home Improvements Add The Most Value?

Homeowners often undertake remodeling projects with an ulterior motive. Sure, they want to enhance their living space; but frequently they hope the renovation or addition will boost their home’s value as well. After all, aren’t three bathrooms better than two? Who wouldn’t want a state-of-the-art kitchen, a finished basement or a swimming pool?

Misguided thinking. When it comes to adding value, not all home improvements are created equal. In fact, “some home projects can actually decrease your home value,” says Mischa Fisher, chief economist at Angi, the contractor search service and house renovation site.

In general, you can expect home improvements to provide a 70 percent return on investment, according to the home remodeling loans platform RenoFi. That figure can vary significantly however, depending on the specific type of project you take on.

Do home improvements always add value to the house?

The short answer is no, home improvements do not always add value. Even if they do, that’s not quite the same as you actually making a profit on the project, or even recouping your costs. There’s a big difference between adding value to your home and earning a return on your investment, says Fisher.

You can look at a project’s returns in two ways: First, how the project raises the total resale or market value of your home. This is a nice way to see how your home’s worth has changed, compared to the money you spent on the project. It can be useful to know if you’re thinking of putting your house up for sale, are contemplating borrowing against it or just want a sense of its overall value — and your equity stake in it — when totaling up your assets.

Alternatively, you can look at the project’s return on investment, or ROI. “This is a measure of how much the home’s value rises as a share of the project cost, typically expressed as a percentage of the total project cost,” Fisher explains. “For example, if a $4,000 garage door improvement adds $3,500 to the value of your home, you could say the project has an 88% ROI. This means you are able to recoup a large share of the project cost. This is different from the financial investment world, where an 88% ROI would mean you nearly doubled your initial investment.”

The point is, don’t confuse a project’s return on investment percentage with the amount of profit — or amount of increased home value. For example, Remodeling’s 2021 Cost vs Value Report says replacing a metal roof costs $46,031 and has an ROI of 56 percent. That means it bumps a house’s potential price tag up by $25,816 — it does not mean the entire value of your home increases by 56 percent. And you’ll notice that the $25K the new roof adds falls significantly short of the $46K spent on it.

Frankly, very few renovations and remodels fully recoup their costs, or even most of their costs.

What kind of home renovations are more likely to add value?

There are specific renovations that historically have been more valuable than others. Here are some that earn the biggest bang for your renovation buck, based on the latest intel from the Remodeling 2021 Cost vs Value Report report and Angi.

  • Garage door replacements: Garage doors are one of the few home renovations that actually come close to recouping their entire cost, offering a 94 percent ROI. Installing a new garage door can be a relatively inexpensive project, costing anywhere from $750 to $1,600. And it’s an investment that can seriously boost your home’s curb appeal.
  • New stone veneer: Putting a stone veneer on the facade of your house (instead of, say, vinyl siding) is not a cheap undertaking. Expect to spend $87,500 to $125,000 for a 2,500-square-foot home. But stone is a sturdy, aesthetically pleasing material that works wonders for curb appeal, says Fisher. It also provides a rock-solid return: 92 percent ROI.
  • Kitchen remodels: Kitchens are easily one of the most important rooms in a home, so it’s no surprise people value a smart, modernized space, says Fisher. On average, kitchen remodels lead to a 72 percent ROI. The average cost of a kitchen remodel is between $25,000 and $40,000.
  • Siding replacement: Siding is one of the first things prospective buyers notice about a home, so it needs to be attractive and sturdy, says Fisher. Replacing siding, which ranges in cost from about $5,400 to $15,500 depending on the materials selected, can lead to a 69 percent ROI.
  • Window replacement: Not only can windows step up the visual appeal of your home, but they can also help keep it as energy-efficient as possible, says Fisher. Though this won’t be an inexpensive project — windows can cost anywhere from $200 to $1,300 each — the 68 percent ROI is crystal clear.
  • Bathroom remodels: Aside from the kitchen, spiffy, up-to-date bathrooms are often the most important aspect of a home that appeals to potential buyers, says Fisher. On average, updating your bathroom leads to a 60 percent ROI. As for how much you can expect to spend on this type of project, the cost varies significantly from $6,200 to $15,200. The national average is about $10,800.

What determines if a renovation adds value?

Are there any rules of thumb for determining whether a renovation will be a value-enhancing proposition? David Steckel, a home expert for Thumbtack, suggests asking yourself this question: Will this increase the number of people who would potentially bid on my home if I were to sell it?

“If the project adds structural renovations or makes it easier for additional projects to take place, then yes, it will add value to your home,” says Steckel.

Renovations that increase the size of a home, or create additional outdoor space with multiple functions, or increase the functionality of spaces, can also be relied upon to add value, says Steckel.

What home renovations might decrease your home value?

Not all home improvements improve your home’s value. Some actually detract from it, because they turn buyers off.

“Potential homebuyers don’t want features that require ongoing maintenance, like in-ground pools and built-in electronics,” says Fisher. “Buyers also prefer homes with more bedrooms, so removing one bedroom to make another one bigger may end up decreasing your home’s value, rather than adding to it.”

Also: Buyers prize ingenuity — hey, look at how that closet fits in there! — but not too much originality. Hyper-personalized styles and details can take away from your home’s value, making it harder for prospective buyers to envision themselves in the space. It also creates an automatic to-do list of projects before the space can feel like home to a new owner.

“If you’re getting ready to sell your home, think about whether your updates will appeal to prospective buyers,” Fisher says. “This will be a particularly relevant question for projects with high visual impact, like overdecorating, installing wall-to-wall carpeting, adding bright, patterned wallpaper to every room or adding texture to your walls.”

If you’re planning on staying in the home for several years to come, it’s fine to indulge your tastes and make rooms feel like you. But you may need to undo some of the work when it comes time to stage your home to sell.

How can you avoid renovations decreasing your home value?

While some projects certainly do increase a home’s value, it’s important to do your research, ensuring that you don’t make changes that may be a turn-off to future buyers.

“Talk to local [contractor] pros before starting a new project to ensure you aren’t accidentally decreasing your home value, especially if you’re thinking about selling,” Fisher advises. You might also get advice from acquaintances in the residential real estate industry, who have firsthand experience with trends and preferences.

You can avoid decreasing your home value by carefully choosing projects, settling on those that have a track-record of reliably boosting curb appeal or that are likely to appeal to the broadest range of prospective buyers.

And remember, the more customized your renovations are, the less likely it is that prospective buyers will like the work you’ve done.

It’s also a good idea to make sure the improvements you make are consistent in character and even in color with the rest of your home. And if the renovations will be obvious on the exterior, make sure any changes you make are also consistent with the surrounding neighborhood as well.

“Homeowners must choose wisely when selecting everything from the layout, contractor, paint colors, finishes and more,” says Steckel. “In order to avoid decreasing the value of a home, keep in mind that the ultimate goal of making upgrades and renovations is to improve the overall functionality of the spaces within the home.”

Should you renovate your home based on your house value?

There are many factors to keep in mind when contemplating home renovations. In addition to being clear on your long term goals for the home and understanding the potential ROI of your investment, you should also consider the home’s value before spending too much money on any changes.

This is because what you get back on renovation investments is also linked to the value of the home. And the value of your home is impacted by such external factors as the value of other homes in your neighborhood. Beware of “overbuilding”: that is, renovations that make a home a lot pricier than its neighbors. Improvements that bring your home’s value up to the average price in the neighborhood, on the other hand, may provide a better return.

If you’re planning on taking on major home improvement projects, like kitchen or bathroom remodels, Angi recommends being safe and budgeting between 10 percent and 20 percent of your home’s value for the job. “The ROI on your home projects will be impacted by the value of your home,” says Fisher. “Spend too little and it will seem like you cut corners, but spend too much and you won’t earn back your money.”

And try to think long term: The housing market is constantly changing, and your home’s value may not be the same six months or a year from now.

The bottom line on home improvements and house value

Homeowners considering major home improvements should think about their own comfort and needs first, and the value of the home second. While carefully selected renovation projects can indeed be a great way to increase your home’s value, the amount of return you’ll earn on that investment is another matter, and will depend largely on the type of project selected.

Real estate history shows that homeowners should not expect to recover all of their money when undertaking remodeling projects. While making a profit is certainly not unheard of, you shouldn’t count on it. It is simply one of many considerations to keep in mind.

“I don’t recommend renovating a home solely based on the current value, as this can change overnight, depending on the market and economy,” says Steckel. “Homeowners should approach renovations by asking themselves, ‘What will appeal to a future buyer the most?’ And consult a [construction] pro to find the best way to achieve this goal within your budget.”