5 Renovations That Improve Your Home's Resale Value-and 5 That Don't
If you’re like most homeowners, there is a long list of upgrades and home improvements on your to-do list. Whether you’ve saved up for something specific or secured a HELOC for ongoing renovations, it can be difficult to decide where to start. Which projects should be pushed to the top of the list because they add more value? It really depends on how long you’re planning to stay in your home and what things are most important to you.
These home improvements really pay off
Some projects have a bigger return than others when it comes time to sell your home. According to Remodeling magazine’s 2021 Cost vs. Value Report, these are some of the upgrades that can really payoff:
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Garage door replacement—Knowing how important curb appeal is, your first thought may be your yard and it can be easy to overlook the impact of a new garage door. This moderately-priced upgrade packs a big punch and can garner a 93.8% return.
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Manufactured stone veneer—Keeping with the curb appeal focus, consider replacing vinyl siding or clapboard with stone veneer. This project can be pricy—luckily, you don’t have to replace the entire exterior to make a big difference. Concentrate on your entryway or architectural bump-out for a modern upgrade. Typically, sellers see about 92% of this cost coming back to them when they sell.
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Minor kitchen remodel—Kitchen remodels can be costly but improving the functionality and design of your kitchen can pay you back in more than just dollars when you sell. Enjoying the years you live in this well-used space is worth so much more. The kitchen is also one of the first rooms potential buyers will imagine themselves in—expect to recover about 72% of your minor remodel.
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Fiber-cement siding—Some people have kept up their home inside and out but have neglected the exterior of their actual house. If this is something on your list, consider replacing your worn-out siding with this new, modern version. It’s an investment, but when you’re ready to sell, you should recoup about 69% of that cost.
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Vinyl windows—Opting for low-E, simulated, divided-light vinyl windows with a custom color exterior finish transforms the outside of your home instantly and provides ongoing energy savings, too. You should get back roughly 69% of the improvement costs.
Be prepared to not see as much return on these projects
No matter how much more comfortable they make you or how much peace of mind they provide, you just can’t expect to recoup your full investment on some endeavors. Of course, that doesn’t mean you should immediately scratch them off your to-do list—just take this information into consideration before you take on one of these projects:
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Invisible improvements—Things like adding insulation to your attic, updating the HVAC system, replacing the gutters or regrading the yard to keep water from flooding the basement are essential but, compared to other improvements—like renovating a kitchen or adding a backyard entertaining space—the changes aren’t so obvious. Think of these projects as a way of protecting your home’s current value rather than a way to increase its future resale value.
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Swimming pool—At first blush, most people searching for a home would be excited if it had a pool. But when you take into consideration the maintenance costs, insurance requirements and loss of backyard space, many buyers don’t necessarily consider it a bonus. According to HomeAdvisor, the average cost to install a pool is over $29,000 so, unless you live in Arizona, Florida, Hawaii or Southern California, you should only consider this option if you and your family will use and enjoy it regularly and plan to stay in your home for at least five years. Otherwise, it may make more sense to invest in a membership at your local pool.
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Major bathroom and kitchen upgrades—You’re probably not used to seeing these projects on a list of “don’ts,” but they can pose a problem for potential buyers for two reasons:
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If you include a lot of extras—Unless you’re going to utilize the double built-in refrigerators or custom steam shower, you may want to consider doing something a little less fantastic. Instead, keep your upgrades relatable to potential buyers. If the features are too over-the-top, people may have a difficult time imagining themselves there.
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If you ignore the rest of the home—It’s always a good idea to upgrade the appliances and modernize the design of a kitchen or bathroom, but over-improving one area while ignoring others may give buyers the idea that the home is a work in progress. Some buyers may worry it will be too much effort to update the rest of the house to match.
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Built-in high-end electronics—Similar to the kitchen and bath upgrades, if you’re considering adding things like a state-of-the-art projector or smart technology lighting, make sure you’re doing so for your own pleasure and comfort because it’s unlikely a buyer will appreciate these features as much as you do.
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Extravagant landscaping—Curb appeal is important when you’re selling your home—a beautiful front yard, along with the outside of the house, is likely what will attract buyers in the first place, right? However, elaborate gardens and unique plants may turn buyers away who don’t have the knowledge or interest to take care of a yard like this.
Of course, there’s nothing wrong with creating the yard of your dreams for yourself and your family—not because you’re planning to make back the money when you sell but because it will make you happy while you live in your home.
If you’ve done the research on different home upgrades, you’ve no doubt heard plenty of experts say that the resale value on those projects is the only metric you should consider. The important thing to remember is that you are the one living there. First and foremost, do what makes you happy—then consider the potential resale value.
Wondering how to start making your current home into your dream home? Mountain America Credit Union can help make it happen. Contact us today to find out how.
