Someday, you’ll sell your home. So you want the money you invest in it to come back to you. However, if you have no plans for selling in the near future, another form of value that you should consider when planning a remodel is the pleasure of making your home more comfortable and attractive.
Although it’s helpful to pay attention to research about the quantifiable value of remodeling projects when you design your own addition, you need to pay attention to what common sense tells you about changes you would enjoy in the here and now. Best choices are remodeling projects that add value and also offer feel-good payback.
Top types of home projects include:
- Converting attic space to a bedroom
- Remodeling or adding a new bathroom
- Updating your kitchen in a minor or major way
- Increasing living space by refinishing your basement
- Building a garage
- Improving your home with a number of small but important refurbishments, including building a deck or replacing the front door
- Figures mentioned here are all 2015 national averages for midrange home projects cited in Remodeling magazine’s annual cost-versus-value report
Maybe you have always wanted a second- or third-story master bedroom where you view the clouds outside your windows and listen to tree foliage rustling in the breeze. It’s like living in a luxury tree house. Instead of popping the roof and adding on, design your own addition and redo your attic as a bedroom. If square footage is limited and standing space must be maximized, forgo a flat ceiling for a peaked one following existing roof lines.
Adding a master suite in the attic with a bathroom or extra bedroom becomes attractive to buyers who are starting their families or know they’ll need more space. If master suites with bathrooms are a common amenity in your neighborhood, then it’s definitely a good investment. Plus an extra bedroom comes in handy when family members or children visit and can easily be converted into something else.
How much is this room addition? Remodeling notes that a nationwide average cost for an attic bedroom was about $51,700 in 2015 and that more than 77 percent of that cost would be recouped now if you were to sell.
Often, the payback for simple remodels is greater than for new additions. That’s true for bathrooms. Everyone wants a fresh bathroom so this is one of the best remodeling projects that will add value to your home.
If you only have one bathroom, adding a second could give you a return of 80% to 130% on your investment. You could build a half-bath at 18 square feet or a full bath for 35 square feet. Adding a bathroom to a bedroom makes it qualify as a master suite, which is also appealing to buyers. Then you can save money by getting the accessories online or at Lowe’s and Home Depot when prices drop on floor models like sinks and toilets.
How much is this room addition? Remodeling reports that, at present, the remodel of a five-by-seven-foot bathroom—complete with new fixtures, cabinets, flooring, and vinyl wallpaper—currently costs about $16,700. In contrast, it costs $39,578 to add a new bathroom of the same size. But a new one may be the only comfortable solution if you own an older home with only one or two bathrooms.
Kitchens are the command central of any home and are an incredibly important space in any house. Homeowners and families spend a lot of their time in the kitchen. And more than any other room, that time is spent working hard and using the appliances, space, and tools you choose for it. That means that the layout and design of your kitchen, the types of appliances you choose, and the amount of space you have available all matter. So a complete redo complete with an island, new cabinetry, countertops, appliances, fixtures, and flooring as well as custom lighting and a fresh paint job may be a feel-good success for everyone, and one of the best remodeling projects that adds value.
We know that kitchen additions can be a big undertaking. They’re hard work, they can be expensive, and they take time—not to mention giving up the use of your kitchen for at least a few weeks! But whether you’re planning a kitchen renovation for your own pleasure or to increase your home’s value, it will pay off. Kitchen additions can and will increase the value of a home for a number of reasons.
While a kitchen remodel costs considerable time and money for you as the existing homeowner, it will be even more of an undertaking for a new buyer, which is why an updated kitchen is a huge benefit for any home on the market. Essentially, a new kitchen will not only increase the value of your home, but it can also make or break a new buyer’s decision to put an offer on your home.
The keys to effective and valuable kitchen-addition plans are the tools and the space, so when it comes to kitchen-remodeling ideas and designing your own addition, keep these two factors in mind:
- Technology is always changing, and kitchen tools are always being updated to be easier and more efficient to use. Having the latest appliances directly corresponds to easier cooking, baking, cleaning, and more—which is a big draw for any homeowner. When you’re already spending a lot of time in the kitchen, and most of that time includes using the appliances and tools you choose for it, a modern and updated kitchen means that everything you do in the kitchen will be easier and faster. An up-to-date kitchen with quality appliances attracts most buyers. Ample space for food prep and organization along with “green appliances” like the dishwasher and refrigerator are very appealing. These appliances save money for both current and future residents alike without damaging the environment. So take time to research these tools and choose features that you’ll not only use but ones that will be attractive to future buyers.
- The space itself is crucial as well for a number of reasons. Obviously, an updated design is going to be more attractive to any buyer and will add value simply by being new. But as you design your new kitchen space, take every opportunity you can to improve its layout. Kitchen layouts with a lot of storage, counter space, and organized and updated cabinets are a big draw for potential buyers. Whether you’re adding on to your existing kitchen, adding an island in the middle for extra work areas, or just rearranging and redistributing your current space to make it easier and more practical, any changes you can make to the layout that can add to storage and organization will add to the value of your home.
When considering a kitchen addition or remodel for your home, think about whether the changes you’re making will create a space that’s easier, more practical, and more helpful to use in your everyday life. If so, you can bet that it’ll pay off and add to the value of your home.
How much is this room addition? If you are only concerned about your kitchen making the grade with buyers during a sale in the near future, a minor remodel of about $19,000 likely will pay back about 79 percent. In contrast, a major redo costing nearly $57,000 may only be worth about 68 percent of its cost.
If your home is outside of flood-risk areas and includes a basement that is either unfinished or outdated, you may want to increase living space by designing your own in addition in the form of a large entertainment area complete with a full bathroom, bar area, plenty of cheerful lighting, and a mechanical area hidden from view.
How much is this room addition? For a 20-by-30-foot space, you can count on this costing more than $65,000 and recouping about 73 percent of costs.
Adding a garage onto your house is a good investment, especially if other homes in your neighborhood also have them. Garages don’t need finished flooring, drywall, or heating/cooling ducts to make them cost-effective. Plus, these spaces can be used to store cars, tools, sports equipment, and more. Houses with garages also appeal to buyers with vehicles since they offer protection from the elements.
Even if your money is tight for home improvement, small changes can make big differences in how you feel about your residence. For example, a new entry door may add greater security as well as greater attractiveness to your home.
How much are these refurbishments? Of all the home improvements cited by Remodeling, a steel entry door costing about $1,230 was the only one with immediate payback exceeding its purchase price. This Old House magazine interviewed real estate brokers to learn what inexpensive projects could boost resale value. All the changes are ones that would also boost the way you feel about your home. They include cleaning up the landscape, repairing plumbing leaks, replacing rain gutters, fixing a broken doorbell, and replacing flooring or carpeting.
Upkeep of your home—with or without the help of architects and contractors—is an investment that both you and future owners will value.
Adding a deck to a home is another way to increase value because outdoor living spaces are very attractive to buyers. These are great additions since more people are choosing to stay home during vacations and they add more space during the warm months. According to HGTV, you can recoup 65% to 90% of your investment on a deck, which can cost anywhere from $1,200 to $10,000, depending on the size and extras. Decks should allow people to transition from the indoors to the outdoors easily, especially convenient during an event with more people. Also, if you’re handy or construction literate, you may even be able to do this task yourself, which saves a lot of money.
Consider going green
Making your addition eco-friendly and energy-efficient will accrue costs in the beginning. However, these options will save you money long-term. Buyers are more likely to purchase energy-efficient homes than not. Installing Energy Star-rated windows can save you up to $500 a year in heating and cooling costs. You can also have a total energy savings of 30 percent each year. Then there’s the opportunity to recoup 60 to 90 percent of your costs when you invest in energy-efficient windows. Plus, you’ll be qualified for a green energy tax credit of 10 percent. Having an Energy Star–rated home reduces leaks and drafts, keeps consistent temperatures, adds durability, and keeps the inside air fresh. Adding plenty of insulation, programmable thermostats, and avoiding hollow metal doors also decreases energy costs.
Home-remodeling projects to avoid
There are good additions and there are bad ones. Here are some home-improvement ideas to avoid that won’t give you a substantial return on your investment:
- Home office
Most people don’t need a fancy home office, therefore building one wouldn’t be a great investment and the technology will surely become outdated as time moves on. You’d have to find the perfect buyer who could benefit from a home office, which might prove difficult.
Though aesthetically pleasing and a comforting thought, sunrooms don’t actually maximize the value of most homes as they only return maybe 49 percent of the initial investment. The glass panels on sunrooms lack insulation, which raises energy costs in the winter. Typically, only people who live farther south or on the beach where other homes include sunrooms could benefit from a sunroom.
- Luxury, gourmet kitchen
While extending a kitchen is a great investment, making the newer kitchen include expensive luxury items might not work. Newer kitchens should all have quality appliances that everyone can use, whereas gourmet kitchens would not attract the average buyer. Only consider a gourmet kitchen if your neighborhood is high-end and everyone else has one.
Homeowners should look into additions that can benefit everyone while increasing the home’s value. There should be a balance of current needs and potential value. For example, adding a music studio only attracts a niche group of buyers, making selling difficult. However, if the room can be easily converted into a different function, then it may be worth the investment.
When considering adding onto a home, researching how much return you’ll receive on the investment is a wise decision. You should talk with your architect who will make sure you’ll get the most of your addition. Additions that have little appeal overall for prospective buyers won’t help sell your home. Also, make sure the addition makes sense with the layout of your home while blending in seamlessly with similar materials.
Don’t move into a bigger home if you don’t have to. When thinking about expanding your home for current needs, room additions that can add to the overall value of your home are essential to maximizing future returns.