You’ve already decided to move rather than remodel, but now — like so many others in similar situations — you find yourself thinking about remodeling anyway. Why? To make your house more appealing to would-be buyers, cut the time it takes to sell it and maybe even get more cash in hand when you sell.
A good place to start is the Cost vs. Value report published annually by the National Association of Realtors, or NAR, and Remodeling magazine. The report provides a synopsis of the top projects, the average costs of the projects and their average rate of investment return at resale. It also gives you a city-by-city guide on what various home projects will pay back at resale.
1. Upscale siding (new fiber cement) replacement.
- Average payback: 103.6 percent of cost
- Estimated job cost: $10,393 for 1,250 square feet
- National average resale value: $10,771
Siding makes a huge difference in a house’s resale value, because it’s one of the first things you see. It really defines the condition of the home. If other houses around you have old aluminum or vinyl siding and your siding is nicer and newer, buyers will notice you. With this project, you make your house more attractive—you’re not just improving your insulation value.
2. Midrange bathroom remodel. This includes updating an average 5-by-7 foot bathroom that’s at least 25 years old with moderately priced fixtures, a double-sink vanity, a ceramic-tile floor and vinyl wallpaper.
- Average payback: 102.2 percent of cost
- Estimated job cost: $10,499
- National average resale value: $10,727
Improving an existing, but outdated, bathroom is almost always a good investment. An up-to-date bathroom makes your home look like it’s been kept in good repair, and that’s what
all prospective homeowners prefer. Think twice about adding a pricey imported soaking tub or three separate shower stalls for your growing family’s convenience. Those enovations might not fit the taste of a buyer 10 years down the road. If that happens, the money you spent on your bathroom renovation is down the toilet, so to speak.
3. Kitchen remodel. This consists of giving a functional, but dated, kitchen a makeover. It includes new cabinets, a moderately priced wall oven, cooktop, countertop, sink, faucet and flooring.
- Average payback: 98.5 percent of cost
- Estimated job cost: $14, 913
- National average resale value: $14,691
Along with bathrooms, kitchen updates are almost always among the smartest remodeling
projects for resale value, say the pros. Home buyers seem to gravitate to the kitchen first when they’re looking at a house. However, I’ve also seen homeowners go too far—they might put granite countertops and top-of-the-line stainless-steel appliances in a very modestly priced house. Those improvements aren’t going to help the home’s value in the long run, and the owner definitely isn’t going to get his money back when he sells.
4. Attic remodel.
This entails converting unfinished attic space in a two- or three-bedroom house into a finished bedroom and bathroom with shower. It includes a new shed dormer, new windows and closet space in the eaves.
- Average payback: 93.5 percent of cost
- Estimated job cost: $39,188
- National average resale value: $36,649
Because this is a relatively expensive undertaking, real estate experts suggest you do an attic renovation only if you’re going to live in the house for a while (preferably five to 10 years) and enjoy the reclaimed space yourself. Over the long haul, this project adds significant value to your home because it creates brand-new living space and isn’t just a cosmetic improvement.
Keep in mind, though, that attic remodels don’t make sense in every neighborhood and
part of the country. In Florida, most of the attics aren’t big enough to stand up in, so remodeling them wouldn’t make sense at all. Plus there’s the heat issue—these rooms would be sweltering hot and very expensive to cool.
A good Realtor should be happy to spend time talking with you about the wisest enovation projects for your home—even if you’re not planning to sell your home anytime soon.
5. Window Replacement. Though not as visible as remodeled kitchens or bathrooms, there are few remodeling projects that improve the overall quality of a home better than new windows. For instance, smart home buyers will recognize that new windows will not only make the home more comfortable and attractive, but will also save on heating and cooling.
Other top resale projects from the Cost vs. Value report ranked by percentage of cost
recouped at resale, include:
- an upscale bathroom remodel: 93.2 percent.
- a major kitchen remodel: midrange, 91 percent; upscale: 84.8 percent.
- a deck addition: 90.3 percent.
- basement remodeling: 90.1 percent.
- window replacement: 89.6 percent.
- a bathroom addition: midrange: 86.4 per cent, upscale 85.8 percent.
- roofing replacement: 84.7 percent.
- a family room addition: 83 percent.
- a master suite addition: midrange 82.4 per cent; upscale 80.1 percent.
- a home-office remodel: 72.8 percent.
While a good return on your investment is important in every remodeling project, experts say that the most important factor in your decision should still be whether the project improves the way you live in your home now.
The fact of remodeling is that you never get your money back instantly. If you’re undertaking a project because you’re going to stay in your home awhile and it will enhance your lifestyle, then great—do it. It’s tough to put a price on the happiness many young families get from fixing up their house and truly enjoying it for the next 20 years.