Would you like to add up to $100,000 in value to your home? Who wouldn’t? Whether you’re selling soon or planning to stay put, the idea of adding such value to your home is very enticing!
Time and again, clients and potential sellers ask us what home renovations they should undertake to maximize their home’s value as well as their home improvement dollar. We love when we are asked this question. We want to see our clients and friends get the biggest bang for their buck!
Keep in mind home improvements can and will serve different purpose throughout the process of selling your home. Some will help get potential buyers in the door, fall in love with the house AND want to pay top dollar. Others keep the buyer in the contract without renegotiating the price lower or asking for a credit.
So below are the top home improvement projects we recommend for getting the biggest bang for your home improvement buck.
If you can, add square footage!
According to a study for the National Association of Realtors, every 1,000 of square feet added to a home increases its sale price by at least 30%!
Estimates of room additions vary widely depending on location and complexity. Nationally, these costs can range from $80-$250 a square foot according to the nest.com (link). In our area, however, these prices can be much higher (plan on $300 per square foot or more, depending on finishes). This difference is due to the older and unique homes found in our region,
So what rooms to add when adding to your home’s footprint? The simple answer: bathrooms and bedrooms, as they generate the greatest return on investment. Bathroom additions offer the greatest returns, according to Remodeling magazine — an average of 86%. Attic bedrooms, specifically, return a hefty 84% according to US News & World Report. The other rooms return anywhere from 70-80% or more of the investment.
KITCHEN RENOVATION / UPGRADE
Spending money to improve the look and functionality of your kitchen is always a good use of your home improvement dollar. Experts agree that you can spend anywhere from 6-10% of your home’s total home value and get fair returns — as long as you choose materials with broad appeal. Whether you do a major kitchen overhaul or more of a facelift, you will see about a 67% return on your investment.
In our area for example, spending a moderate 8% of a $750,000 home’s on a kitchen redo translates to a $60,000 budget, with a $40,000 return on this investment when you do sell.
When remodeling, think quality and traditional materials: all-wood cabinets, stainless steels (commercial grade, if possible) appliances, natural wood or stone floors and countertops. If your kitchen just needs freshening up, try replacing your cabinet hardware or giving the walls and cabinets a fresh coat of paint.
Keep in mind, if there is a dream item in your kitchen remodel plan (that $9,500 La Cornue range, for example), you will NOT recoup that investment. That said, consider the emotional return on your investment here as well. If that range is going to bring you joy on a daily basis, go for it!
Enhancing the exterior of your home is always on our list of recommended updates, especially for potential sellers. House hunters often make a decision about your home before they even get out of the car. Plan to spend some of your home improvement budget on boosting your home’s curb appeal. Simple, inexpensive fixes like new hardware, a fresh welcome mat, or planting some colorful flowers along your entryway, can go a long way when selling.
While not very exciting, a new roof will net you a whopping 105% return gain when you sell! Nationally, the average homeowner spends about $6,800 to install a new roof according to homeadvisor.com. Of course the cost depends on your roof’s size, pitch, materials used, etc.
In our area, a new roof will likely cost you around $10,000 but it is one of the best investments you can make.
Replacing your home’s siding is another solid choice. You can expect to pay $8,400 to $19,600 to have an average-sized two-story house completely redone by a professional (average price per square foot is $3-$7 installed. The good news is that you can expect to recoup a generous 93% of this cost, according to the Remodeling study.
Installing a new front door is your also a good bet. The cost ranges from $1,500 – $5,000 but adds, on average, 97% of the amount you spent to the value to your home, according to Remodeling. Garage door replacement also yields a healthy return of 84%. Go for an on-trend choice such a the carriage house style garage door.
Buyers assume major systems like electrical, plumbing, and HVAC are all in good working order. If buyers learn at their home inspection that they will need to place a system soon, they may be scared off (trust us, we’ve seen it happen!).
While systems are not very “sexy,” they are extremely important to house hunters.
Replacing your HVAC system yields a 71% average return. Click here for an calculator of what this upgrade may cost you. Consider also the benefits of lower utility bills with a more efficient system.
The cost of upgrading your existing electrical service panel to a 100- or 200-amp panel (a must for today’s high tech homes) ranges from $800- $3,000. Again, while not the most exciting expenditure, this upgrade is a worthwhile investment, especially if you do plan to sell soon.
Also consider adding attic insulation – you will enjoy a sizable 117% return, according to realtor.com and your home will be warmer in the winter and cooler in the summer.
Whether you add a deck for your own enjoyment or that of your home’s next owner, it is a solid home improvement choice. Adding a wood deck nets homeowners an 87% return, according to US News & World Report. You can plan to spend about $15 per square foot for a professionally-built pressured-treated deck up to $35 per square foot for a more elaborate one made of hardwoods or composite materials (according to HGTV.com).
Sunrooms, on the other hand, offer one of the lowest returns, just 52%. So be sure to spend your funds on true outdoor space.
If you are selling soon, work on creating an inviting outdoor space. Add a flagstone patio or firepit.
Think about the broad appeal of your projects, especially big ticket items like that in-ground pool you’ve always wanted.
Many house hunters won’t even consider homes with pools for safety and/or maintenance reasons.
A NOTE ON THE IMPORTANCE OF STAGING
While not technically a home improvement, we alway urge sellers to invest in the right staging when selling a home. A quality staging job helps potential buyers envision themselves living in your home.
Research has proven that staged homes sell 79% faster and for 17% more than non-staged homes.
So consider staging a very worthwhile investment as well. You will recoup these funds and then some!
THE BOTTOM LINE
Be sure to get at least two or three estimates on any work you plan to undertake. Costs can vary widely. Also, ensure that your contractor pulls any necessary permits and is licensed and insured. It’s always a good idea to save your receipts, manuals etc. for reference or for the buyer of your home as well as to reduce capital gains taxes.
When selling, remember that high visibility and “sexy” projects like new kitchens and bathrooms and new square footage will help bring traffic into your home and drive people to offer top dollar. The right staging helps enormously! Other improvements like a new roof or upgraded electrical panel often keeps contracts together and can help in final negotiations.
As always, if you need any recommendations for contractors, please reach out. We have an extensive list of people and companies for just about every project on your list.
If you’d like to chat about what options make sense for you in your current situation, let us know. We’re always happy to chat, even if you’re not quite ready to make a move.