What home improvements have the best return on investment? Smart remodeling decisions are based on the answer to this question that is asked with an eye to putting …
What home improvements have the best return on investment? Smart remodeling decisions are based on the answer to this question that is asked with an eye to putting the home on the market.
Let’s prioritize the possibilities by dividing them into renovations you Must, Should and Could do.
You Must Fix Structural and Mechanical Problems
These aren’t the home renovations most dream about doing, but without fixing major problems, your home won’t sell for anything near its value, if it attracts a buyer at all. In short, these projects have excellent ROI.
1. Driveway cracks, crumbles and low spots must be repaired
You know the value of curb appeal. When buyers approach a home with a concrete or asphalt driveway in poor condition, all they see are dollar signs, big ones, and a lot of them.
2. Make the exterior presentable
A home with pea-green siding from decades ago can sell if priced appropriately and if the siding is in good condition. Siding in visibly poor repair, whether vinyl, wood or brick, is a very tough sell. Siding replacement brings 77 percent return, but it is much more expensive than repairing what is there.
3. Repair foundation damage
Water in the basement sends buyers running with impressive speed. The problem doesn’t have to be a major leak, either. The penetration of a small amount of moisture will leave the basement smelling musty with lurking mold and mildew. Find and fix the source.
4. Get the HVAC working
No heat; no deal. AC is somewhat more negotiable. You can fix it, replace it or give the buyer’s money back at closing to do it themselves.
Switches and fixtures, roofing materials, plumbing fixtures, the water heater and the pipes must be in good working order.
Cara Ameer of Inman real estate news suggests that once you’ve made these repairs, you can solidify buyers’ confidence if you, “offer a home warranty that can provide some coverage should something fail or need repair.”
You Should Update the Home
The next level of priority is to bring the home into the current decade with cheap-to-moderate updates. These often have homebuyers thinking, “we can live with that for a few years” even if the updates aren’t completely their style.
1. Replace road-facing doors
According to the definitive 2016 Cost vs. Value Report using US national averages, replacing the front door brings 91 percent return on investment. A new garage door brings a 92 percent ROI, though the total cost will be higher.
2. Add a fresh coat of paint
Neutral paint is so 2000s. Don’t be afraid to add some color, but do so wisely by consulting an interior designer or home magazines for colors that combine contemporary flare with good staying power in terms of appeal. Andrea Lucena-Orr has a fun idea. When repainting, spend a little more time and money to create what she calls a feature wall that combines interesting colors with complementary art and similar features.
3. Replace worn vinyl and carpet flooring
Cheap materials that significantly improve the home’s appearance can be installed for less than $4 per square foot and offer good ROI.
You Could Complete a Major Remodel
You will lose money on each of these projects because none bring a 100 percent ROI. However, they accomplish two benefits.
- They make the home more enjoyable for you to live in
- They make it more appealing to lookers, so could be the difference in whether a buyer chooses your home or one with these improvements
ROIs for these are based on the national 2016 Cost vs Value Report
1. Remodel the kitchen
A cost-conscious remodel using affordable materials brings an 83 percent return; a major kitchen remodel produces just a 65 percent return of a higher dollar amount spent. Fresh and cheap is smart.
2. Finish the basement
Adding living space to a home lights up the eyes of buyers that have kids, like to entertain or want more in a home than yours currently offers. The ROI is 70 percent.
3. Add a deck
Making more of outdoor space by installing an affordable and attractive pressure-treated wood deck gives your home a larger, more functional feel and returns 75 percent.
Here’s a short list of other remodeling jobs you could do to boost your lifestyle and attract house hunters – with ROI:
- Bathroom addition: 56 percent
- Bathroom remodel: 66 percent
- Family room addition: 68 percent
- Master suite addition: 64 percent
- Adding faux stone veneer: 93 percent
Update your Home with the Buyer in Mind
You’re boosting your home’s value not to increase your property taxes, though that can be a consequence in most states. You do it to appeal to a seller, right? That’s why real estate agents tell you to replace personal photos hanging on the wall with generically attractive ones and to rent a storage unit and declutter your home when preparing it for the market.
This guide helps you see home improvement through the eyes of a buyer or their home inspector. Prioritize your list with must, should and could, and you will add value and make your home easier to sell.