Remodeling Projects: How Much Value Can They Add?
Every year, Remodeling Magazine releases their report on remodeling projects that provide the most return on the price. Basically, they look at how much a project costs, how much it adds to a home’s value, and compare the two. Suppose a project costs on average $3,000 to complete, while it adds exactly $3,000 to the value of the home. In this case, the average return on the investment, or, as they called it, the “cost recouped,” would be 100%. But if the project only added $1,500 in home value, the cost recouped would be 50%.
This information can be useful for people who plan to sell their home in the next few years. It not only gives you an idea of how much a project will cost (on average), it can also give you indications for what type of projects attract buyers. Basically, a good return on the cost shows that the project is something buyers desire; you may not recoup all your money, but it shows that buyers may pay more to have this feature.
Remodeling Projects: What are the Best Updates to Add to Your Home in 2020?
The Best Remodeling Projects Across the Country
Manufactured Stone Veneer: 96%
A stone veneer gives your home an elegant appearance. Despite not bringing all of your money (on average) back in home value, this is the best project across the country for recouping your expenses. The cost is relatively high, at an average of roughly $9,400, but it also brings about $8,900 in value to your home, which mean a return on your investment of approximately 96%.
Garage Door Replacement: 95%
This project is more affordable, at only $3,695 on average. This includes removal and disposal of the old door, as well as the installation and syncing of the new garage door, which includes steel hinges and ball-bearing rollers.
Midrange minor Kitchen Remodel: 78%
If you want to recoup at least some of your money from a remodeling project, it appears that staying in the midrange pricing with only minor changes is best. Even then, you won’t get an outstanding return. At a 77.6% recoup, which is a sharp drop from the previous two, a minor, midrange remodel to the bathroom is actually the third-best project for adding value to the home.
Siding Replacement with Fiber-Cement: 78%
Fiber-cement siding is extremely useful for adding value to your home and enhancing a house. It has a long life span, comes in a variety of textures, and can be heat and fire resistant. For these reasons, many people will pay extra for a home with fiber-cement siding.
Siding Replacement with Vinyl Siding: 75%
Only slightly cheaper on average than fiber-cement siding (roughly $14,000 compared to $17,000), vinyl siding is also attractive and useful. It brings a decent return on your investment, allowing you to recoup about 75% of the cost when you sell the home.
Projects that Bring Low Returns Across the Country
These projects can enhance your home, but they bring only a small return in home value compared to the overall cost…
- Upscale bathroom addition: 55%
- Midrange bathroom addition: 54%
- Major upscale kitchen remodel: 54%
- Grand entrance: 53%
- Upscale master suite addition: 52%
The Best Remodeling Projects in the Pacific Region
Manufactured Stone Veneer: 120%
There are very few projects that actually bring more in home value than their costs, but if you live in the Pacific region, it appears that manufactured stone veneer can actually add about $12,000 while only costing $10,000.
Garage Door Replacement: 117%
A garage door replacement in the Pacific region is also one of the few projects that bring a positive return, as it costs about $3,900 on average yet brings about $4,500 to the value of your home.
Replacing Entry Door with Steel Door: 88%
A strong, sturdy door is an excellent addition, bringing safety and peace-of-mind to your home. If you install this feature to your Pacific-region home, you can expect to recoup about 88% of the costs.
Midrange Minor Kitchen Remodel: 87%
Once again, we see that moderate changes are best for getting a return on the remodeling costs. At an average recoup of 87%, midrange minor kitchen remodels are a solid way to improve your home without throwing away too much cash.
Siding Replacement with Fiber-Cement: 78%
In the Pacific region, this project costs just over $20,000 on average. But it brings in roughly $16,000 in total returns, so it’s a decent remodeling project when it comes to recouping value.
Projects that Bring Low Returns in the Pacific Region
- Midrange bathroom addition: 59%
- Major upscale kitchen remodel: 57%
- Upscale bathroom addition: 56%
- Upscale master suite addition: 55%
- Upscale bathroom remodel: 54%
Remodeling: A Poor Investment, but a Great Purchase
Overall we see a slight trend: few projects bring a positive return, and most (in fact, almost all) will cost more than they add to your home’s value. In almost all cases, you will actually lose money on remodeling.
So why remodel at all?
The most obvious answer is because you want to! If the remodeling, such as an updated kitchen or new deck, will make you happy, then you should go for it. As long as you can afford the revisions, there is really no reason why you should not remodel your home.
Another reason is that the changes could help move your home faster. Some projects are highly desirable to buyers, and they may help sell the home quickly.
Finally, some remodels and revisions are simply required. New siding or a roof replacement, as examples, may be necessary for the home; you may have to conduct the changes and accept the cost, even if you will get virtually no return from the expense.
Loans to Help Update Your Property
If you need financing for your home remodeling, contact our helpful staff today. Whether you are making necessary repairs or want to add an opulent bathroom to a new wing of the house, we are here to help you secure the perfect financing for your project!