Top Five Renovation Projects to Increase Your Home’s Value
If you’re a homeowner, you’re likely always thinking about how you can improve your home to better suit your needs. But home improvement projects aren’t just to increase the aesthetic appeal of your property. They can make a significant impact on the retail value of it as well.
When done right, your project can mean more money in your pocket in the long-term. As they say, sometimes you have to spend money to make money, and this is one of those times.
Your home is one of, if not the most significant investment you’ll make in your lifetime. The key to maintaining the value of that investment is knowing how to spend money to improve it. Luckily, we are here to help you get the most bang for your buck.
First and foremost, consider what percentage of your home value you should spend on each renovation to maximize your financial yield. The Cost vs. Value Report 2020 compiles annual research into one handy at-a-glance tool. This doesn’t mean you shouldn’t do your own research, but it will give you a good idea of the projects you should pursue to maximize resale value.
There are several factors to consider when choosing projects that will best suit you, your home, and your budget.
Cost of the Job
In other words, the estimated total cost of the project. As estimates go, this number can be quite variable. It depends greatly on the labor used and the materials you choose. The estimate is not going to be the same for a homeowner who goes for high-quality materials as it would be for one who uses mid-range materials.
Resale value is a highly subjective variable. What works for the existing homeowner may not work for the prospective homebuyer. The project’s perceived value can also depend on other factors, including the condition of the rest of the home, local real estate market prices, and the rate at which that market is fluctuating. With that in mind, consider estimated values as an overall snapshot rather than a specific individualized prediction.
The recouped cost is the amount you get when you subtract the job cost from the resale value. Of course, this is dependent on the numbers you input into the equation, but based on research, certain projects are more likely to yield a higher return.
Here are five typical home improvement projects that yield top returns on investment in Maryland and Washington, DC. They are ranked in order of highest recouped cost percentage to lowest.
1. Manufactured Stone Veneer
These veneers have proven to be both a stylish and durable solution for homeowners everywhere. According to estimates from the Cost vs. Value Report, removing one-third of a home’s vinyl facade and replacing it with a manufactured stone veneer can cost approximately $9,000-$10,000, and recoup up to 96 percent of the spend.
2. Replacing the Garage Door
Garage doors can quickly become worn and inefficient between regular use and general exposure to the elements. For a combination of function and curb appeal, we recommend replacing your four-panel garage door and updating it with galvanized steel tracks, while keeping the existing motor system. A project like this can cost around $3,500 and typically has a recoup rate of 95 percent.
3. Minor Kitchen Remodel (Mid-Range)
Ask almost any homeowner, and they’ll tell you that an updated kitchen is one of the most desirable home improvement projects. While this is true in terms of curb appeal, it doesn’t necessarily yield the same financial payoff as other projects because of its higher job cost. A mid-range kitchen remodel punches in with a $23,000 estimated cost and a 77 percent rate of recoupment.
4. Siding Replacement – Fiber Cement
A fiber cement siding replacement with a good water-resistive base can put you back about $17,000 but has a recoup rate of around 78 percent. The good news is, the recoup rate on this job has been very consistent in recent years and has increased two points over 2019.
5. Siding Replacement – Vinyl
If fiber cement isn’t your style, a vinyl siding replacement might be. The recoup for this project is estimated at around 74 percent. It’s return is lower than for fiber cement, but then again, so is the price, at approximately $14,000.
When you’re ready to renovate, the design-build team at Winthorpe is here to help. Reach out today, and let’s get started.