A lot of people get excited at the idea of a home renovation. They have grand ideas of how they want their home to look. But one thing to keep in mind is how those ideas will affect your home's value once it comes time to sell after a tenure of nine years, according to the National Association of REALTORS®.
It's important that you do some research before committing to any home renovation project. A good place to start is with a cost versus value report. The report is based on information gathered from real estate agents and RemodelMAX, an online remodelers estimator tool. It will will help you outline the average cost, resale value, and cost recouped for a number of home renovation projects, providing both national and regional estimates. City estimates are also available, but you have to register to access these reports.
To help you determine what renovation projects could add value to your home, here are seven renovations that are worth considering:
- Bathroom. When renovating a bathroom, there is no need to go overboard with a complete overhaul. In fact, according to Remodeling’s 2016 Cost vs. Value Report, simple low-cost renovations on average yield a 10% higher return on investment compared to upscale renovations. Instead, consider adding new light fixtures and some paint to revitalize your bathroom.
- Kitchen. According to the Consumer Reports National Research Center, 53% of real estate professionals believe that the kitchen is one of the most important rooms to prepare before putting your home on the market, so this isn't a room that you want to ignore. However, the national average for a minor kitchen renovation is likely to set you back $20,122 with a resale value of $16,716. Since you're only likely to recoup 80% of the cost, be sure to consider minor repairs and a gentle spruce up before undertaking any major kitchen renovations.
- Income Suite. One of the most direct ways of adding value to a home is to have an income suite. Whether you have a beautifully finished basement or an attic/apartment living space, having the option for a tenant (or even just a guest room), will no doubt boost your value.
- Make a Good First Impression. First impressions count and they also generate a higher return on investment. Entry and garage door improvements feature near the top of the Cost vs. Value rankings, so if your entrance way looks a little dated, this may be a good place to start.
- Energy Efficient Windows. The real estate world continues to go green, so the more energy efficient your home is, the better. Energy Star claims that adding Energy Star-rated windows can save you up to $500 a year. If your windows look like they’re from the 1970s, it could turn off potential buyers.
- Energy Efficient Insulation. Attic insulation has the highest return on investment of any project listed on the 2016 Cost vs. Value Report, with a 116.9% return on investment. If your attic lacks proper insulation, the average cost of installation is estimated at $1,268 with a resale value of $1,482.
Do some research before making any major renovations and you’ll be more likely to make decisions that will pay off when it comes time to sell.