Are renovations worth the investment?
Byline: Metro Creative Services
The cost of remodeling a home is easier to stomach when homeowners can expect to recoup a sizable percentage of the costs of the renovation. While basing renovations on their potential impact on resale value may be unwise, return on investment is something homeowners must consider when mulling renovation projects.
Many homeowners wonder which renovations will resonate most strongly with potential buyers when a home is put up for sale.
According to Remodeling magazine, homeowners are less likely to recoup their investment in a major kitchen or bathroom remodel than they would with basic home maintenance, such as new siding. That's because buyers are most interested in how the bones of the house -- or those elements that keep the house protected and can be costly to fix -- were maintained.
Each year Remodeling magazine issues its Cost vs. Value Report, which highlights the projects that offer the most return on investment. In 2016, the No. 1 project was the installation of fiberglass attic insulation, which could produce 116.9 percent recouped cost and a resale value of $1,482.
Rounding out the top five were manufactured stone veneer for the exterior, a standard new garage door, a steel entry door, and an upscale garage door.
Projects with the least return on investment tended to be more expensive undertakings that offered returns of roughly 57 percent. Such projects included bathroom additions, upscale bathroom additions, upscale master suite additions, upscale bathroom remodels, and deck additions.
For those considering more expensive renovations, keep these figures in mind, courtesy of Forbes.
* A major remodel of a 200-square-foot kitchen can cost around $113,000, with homeowners recouping 60 percent.
* Replacing 1,250-square feet of siding with new fiber siding can cost $13,000, but homeowners can expect to recoup 80 percent of that cost at resale.
* Replacing 10 existing double-hung windows with vinyl low-e glass windows is valued at $14,000, and the return can be between 68 and 73 percent.
There are even renovations that seem like good ideas but can actually hurt the resale value of a home. MSN Money lists these projects as money-wasters for those who want to sell soon.
* Lavish lighting fixtures can look dated in a few years when trends change.
* Wallpaper or textured walls can be notoriously hard to change, and buyers know that.
* Kitschy renovations, such as 1950s diner tiles, may appeal to only a select number of people. Neutral renovations are better if resale is the goal.
* Many real estate experts warn against converting a bedroom into anything other than a bedroom -- even for the purposes of a home office. Such conversions can immediately devalue the property. The same can be said about combining two small bedrooms into one larger space.
Homeowners should investigate potential renovations before committing the time and money to something that may offer little value at resale.
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|Title Annotation:||Real Estate|
|Publication:||Daily Herald (Arlington Heights, IL)|
|Date:||Dec 30, 2017|
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