Home Improvement – What Upgrades Will Increase Your Home’s Resale Value?
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Home improvement, also called home renovation or remodeling, is the process of renovating or making additions to one’s home. It can be a small job such as repainting a room or an entire house, or a major renovation project such as adding an entirely new kitchen or bathroom. Some projects will positively affect resale value while others could actually hurt it.
Homeowners are spending more on improvements to their existing homes, rather than buying a new one. The reason? Higher mortgage rates are discouraging people from trading up. In addition, more homeowners are aging in place, so they’re more likely to need renovations than younger folks.
According to a recent Houzz survey, a third of homeowners plan to spend money on home improvement this year. Some will be remodeling their bathrooms and kitchens, while other homeowners may spruce up the electrical wiring or cabinetry. But before you start pulling out the hammer and nails, consider what upgrades are worth the money.
Whether you’re thinking about doing some DIY home improvement or hiring a contractor to do the work for you, it’s important to think about how each project will impact your home’s resale value. It’s also a good idea to get a professional opinion before making any significant renovations, such as installing a pool or turning a garage into a living room.
Some popular home improvements, like installing a granite countertops or upgrading to a new hardwood floors, will boost your home’s resale price. But other high-end upgrades, such as a custom home recording studio, are less likely to attract potential buyers. And some landscape projects, such as planting a lot of trees, aren’t worth the cost.
While you might love your new bathroom’s marble flooring, it might turn off some buyers. Instead, opt for low-cost upgrades that will appeal to a wide range of buyers.
Lastly, don’t overspend on your home improvement project. Getting into debt to do home improvement can backfire and hurt your resale value in the long run. A better approach is to save up the money you need for each project and pay cash.
The most valuable home improvements are those that increase your home’s value in fair relation to the amount of money you spend on them. However, this can be difficult to determine in advance. Remodeling magazine’s annual cost-vs-value report can provide helpful national data on this subject. In general, small-scale renovation projects like replacing an entry door or a garage door will bring in the highest ROI. Meanwhile, a major kitchen remodel will only return about 60 percent of your investment. And a master suite addition will bring in just about 50 percent of the cost when you sell your home.