Each year, QualifiedRemodeling.com, Remodeling Magazine and other Remodeling experts conduct a cost-versus-value analysis to determine which of 29 home projects offer the best return on investment. In 2018, it might be new bathroom remodels or kitchen remodels that top the list.
It’s attic insulation. It’s an inexpensive project that can be done for less than a couple thousand and has an estimated return of 108 percent. In addition, regardless of whether you are adding value to your home or are planning to sell. “Anything that lowers the cost of owning a home [is smart],” says Tom Quay, co-founder of Equity Real Estate Group of Billings, MT and also Loveland, CO.
New garage door. A Remodeling Contractor might vary in opinions when it comes to what they consider upscale renovations, sometimes a small investment can go a long way. Replacing your garage door offers one of the best returns on investment. Sellers can expect to recoup 85 percent of the cost of this project; our expert says that while a new garage door can help sell a house, people should be smart about which one they install. He recently fixed and flipped two houses in Montana. On one, he opted for a basic door without an electric opener. “I didn’t think people were expecting that,” he says, based on the other homes in the neighborhood. He was right. The house sold in one day. If it’s your plan is to stay in the neighborhood, there is nothing more appealing that a garage door and entry way system that accents your home and pops out and grabs you every time you come home and you will recoup your investment upon resale.
Better front door. Don’t stop with the garage door. A new front door can also be a good investment. According to Remodeling Magazine, you’ll recoup almost 91 percent of the cost on a steel entry door and nearly 78 percent on the price of a fiberglass one.
Kitchen remodels. Said to be the heart of the home, the kitchen deserves some extra attention if you’re hoping to add value or sell. “You want to go after the wow factor,” says Amber Wiggens, founder of Wiggens Home Staging and Sales. That doesn’t necessarily mean making a complete overhaul, but could include refacing cabinets or updating finishes. A minor kitchen remodel will recoup 80 percent of its cost, according to Remodeling Magazine, while a major midrange kitchen remodel only has a 65 percent return on investment.
Bathroom improvements. The bathroom is another prime place for renovations. On one of the houses Kopstein flipped, he choose to replace the vanity, lighting and toilet. It was an inexpensive way to dramatically improve the look and feel of the room. Adding a bathroom is a major investment, and it doesn’t have the best return. Reports from both the National Association of Realtors and Remodeling Magazine say homeowners will recoup slightly more than half their investment. However, it may be essential to making a sale, especially if there is only one bathroom in the house. “When you’ve got over three bedrooms and you’re all sharing one shower, that’s really tough in a resale market,” our source comments.
New windows for home. Replacing old windows can brighten a room and resale prospects. There’s no need to splurge though if you just want to recoup the cost of new windows. Typically the cost of new windows can be recovered with the energy savings and tax credits alone. Remodeling Magazine reports vinyl replacement windows have a 74 percent return on investment, giving them a 1 percent edge over wood windows.
More square footage. Refinishing a basement or other space can dramatically boost the value of a house in some areas. “In Montana, we have a relatively higher price per square foot,” Shepherd says. “To spend $20,000 to $30,000 to finish [off a space] makes a ton of sense.” A 2015 National Association of Realtors report considered the value of converting a basement to living space. It estimated homeowners could expect to recoup 69 percent of the project price. The return on investment for converting an attic to living space was estimated at 61 percent.