What Renovations Will Increase Your Home Value The Most?
Renovating different parts of your home can go a long way in increasing the value of your home. Whether you’re looking to sell your home now or later down the line, you can make various changes that can get you a huge return on investment (ROI).
But which renovations have the greatest impact on your home value? Which ones should you focus on first? Let’s take a look!
Kitchen and Bath Renovations
Of all the remodels you can invest in, newly renovated kitchens and baths are definitely the biggest value adders to your home. Why? One reason is that kitchens and bathrooms are high-traffic areas. When you think about it, they’re some of the most important rooms in your house.
Your kitchen is where you make your meals, entertain guests, and have family time. Yet, your bathroom is just as important. Like the kitchen, it can wear down and deteriorate with regular use.
So, it’s no wonder that an outdated kitchen or a deteriorating bathroom can lower the value of your home. Just by updating your kitchen with new cabinetry, flooring, or countertop and making a few simple replacements in the bathroom like new vanities, bath or shower wall surrounds, and replacement shower enclosures can really rejuvenate the space.
However, you can do even more to your kitchen or bathroom to really transform it. For example, with a full renovation, you can change the layout to maximize your existing space.
You can even get a kitchen or bathroom extension to enhance the openness, functionality, or beauty of your spaces. There’s so much you can do with kitchen and bathroom remodels, from making small changes to making complete transformations that give the areas more function and aesthetic appeal.
So how much value can a bathroom or kitchen remodel add to your home? The answer varies by room. Let’s start with the bathroom. According to a 2021 cost vs. value report by Remodeling magazine, the ROI for a bathroom remodel depends on the updates you make.
The report shows how much home value 5 different types of bathroom remodels can add.
2021 Cost Vs. Value Report
- Midrange Bathroom Remodel: $14,671 in resale value
- Upscale Bathroom Remodel: $41,473 in resale value
- Universal Design Bathroom: $22,475 in resale value
- Bathroom Addition (Midrange): $30,237 in resale value
- Bathroom Addition (Upscale): $54,701 in resale value
NOTE: The amounts spent on each of these remodels are lower than in actuality because the report bases the amounts on permitted costs. Permitted costs are usually only about 50% of a project. These costs include work like HVAC, plumbing, electric, and framing but do not include work such as flooring, cabinets, and counters.
Now let’s put that into perspective. If you spent the national average of $24,000 on a mid range bathroom remodel, you could get a 60% return of how much you spent and up your home value by $14,671.
According to the same Remodeling report, here’s what added home value could look like for a kitchen remodel:
2021 Cost Vs. Value Report
- Minor Kitchen Remodel (Midrange): $18,927 in resale value
- Major Kitchen Remodel (Midrange): $43,364 in resale value
- Major Kitchen Remodel (Upscale): $80,284 in resale value
These numbers show that just by making a small update to your kitchen can increase your home’s resale value by $18,927 and give you a return on investment of up to 72%.
Energy-Efficient Upgrades
Making energy-efficient upgrades can not only reduce your utility bill while you live in your home, but it can also offer more appeal to buyers when you’re ready to sell. In fact, if a home shows annual energy savings of $1,000, the average homebuyer is willing to pay an additional $8,728.
According to a 2016 Remodeling report, just by adding air-seal and fiberglass insulation to your attic—which costs $1,268 on average—you can increase your home resale value by $1,482, which amounts to an ROI of 116%. In fact, the magazine states that insulating or re-insulating the attic is the top energy efficiency home improvement in the United States.
Upgrading your appliances and heating and cooling system as well as replacing windows can also add resale value to your home. For example, according to Money magazine, installing a new central air conditioning system can increase your property value by 10%.
Additionally, vinyl window replacement and wood window replacement can increase your home’s resale value by $13,050 and $14,725, respectively. Solar panels are another energy efficient upgrade to add to your home, with the potential to increase your home’s appraised value by $20,104.
Outdoor Home Upgrades
According to Remodeling magazine, outdoor renovation projects can also increase your home value. These include:
Outdoor Home Upgrades
- Garage Door Replacement: A $3,769 increase in resale value
- Siding Replacement: A $15,090 increase in resale value
- Deck Addition: A $12,464 increase in resale value
- Roof Replacement (Asphalt Shingles): An $18,780 increase in resale value
- Roof Replacement (Metal): A $28,196 increase in resale value
Outdoor Home Upgrades
- Cleaning or Repainting Your Front Door: Cleaning your front door or updating the paint can improve the look and feel of your home. But completely replacing it with a steel door can bring a 90% ROI.
- Landscaping: Landscaping can add 14% to the resale value of your home.
- Cleaning The Exterior of Your Home: Power washing on the exterior of your home can add between $10,000 and $15,000 to your home value.
Key Takeaways
- Remodel for you and your needs. While some resale value is gained from remodeling the real value is the positive impact it has on the lifestyle improvements for you and your family that come from remodeling. for more info, check out our article about how home rennovations can make you happier!
- The exception is if your kitchen or bath are extremely outdated or have cabinets or appliances that do not function.
- Your home compared to other homes in your neighborhood: Realtors price houses by comparing to similar houses in the neighborhood that have sold recently. If every house in your neighborhood except yours has been remodeling then remodeling would add even more value to your home.
- If you are selling your home the best way to invest your money to maximize resale is to invest in curb appeal. Painting or replacing your front door, minor improvements to landscaping, or painting/washing the exterior of the home are all great examples of improving curb appeal.
The Bottom Line on Improving Resale Value With Remodeling Projects
Upgrading different parts of your home can not only add enjoyment and functionality to a space, but it can also improve your home value. Whatever remodeling project you undertake, just make sure you have a full understanding of the investment value for every dollar you spend.
At McManus Kitchen and Bath, we’re here to help you take on your kitchen and bath remodeling project and help you get an impressive return on your investment. Schedule a consult with us today.
