Have you already decided to move rather than remodel only to realize, like so many others in the same boat, you are still thinking about remodeling anyway? Why? To make your house more appealing to would-be buyers, cut the time it takes to sell it and maybe even get more cash in hand when you sell is why. While you’re remodeling that other part of the house why not tuck in a new master bedroom suite above the addition? You’ll get all of your money back when you eventually sell your house, right?
Not so fast. While many home-remodeling projects are a great way to add value to your home, not all of them are ironclad cash-back guarantees. Before you invest a significant amount of your precious home equity into remodeling projects, it’s wise to do a little homework on what kind of payback you can expect for various home projects in your area.
A good place to start is the Cost vs. Value report published annually by the National Association of Realtors, or NAR, and Remodeling magazine. The report provides a synopsis of the top projects, the average costs of the projects and their average rate of investment return at resale. It also gives you a city-by-city guide on what various home projects will pay back at resale. Real estate experts caution that these numbers can differ significantly depending on your state, city or even neighborhood. So use these numbers as a starting point, but consider getting the advice of a Realtor and/or remodeling contractor before you commit to a big home project. These experts can familiarize you with remodeling payback figures tailored to your state, city., or town.
The third project of five to potentially boost your home’s resale value is a minor kitchen remodel. This consists of giving a functional, but dated, kitchen a makeover. It includes new cabinet doors and drawers (with cabinet boxes left in place), a moderately priced wall oven, cooktop, countertop, sink and faucet and resilient flooring.
Average payback: 98.5 percent of cost
Estimated job cost: $14, 913
National average resale value: $14,691
Along with bathrooms, kitchen updates are almost always among the smartest remodeling projects for resale value. Home buyers seem to gravitate to the kitchen first when they’re looking at a house and even appraisers give extra credit to houses with updated kitchens. However, homeowners can go too far. For example, they might put granite countertops and top-of-the-line stainless-steel appliances in a very modestly priced house. Those improvements aren’t going to help the home’s value in the long run, and the owner definitely isn’t going to get their money back when they sell.
