All home improvement projects are not created equal.
While the average remodeling job recoups less than two-thirds of its cost at sale, according to Remodeling Magazine’s “2018 Cost vs. Value” report, some renovation projects are far better investments than others. Last month, we shared Seven Home Renovations that Aren’t Worth the Investment. In this companion piece, we’ll take a look at some of the best home renovation investments you can make.
Start by considering the cost versus the value of your proposed projects.
Even if certain home improvement projects won’t likely recoup their cost upon resale, they may add enough value to your lifestyle to make them worth undertaking. Enhancements to your home’s comfort and livability, for example, can still be worthwhile. A number of handy online calculation tools exist to help you determine the value of a proposed renovation.
Identifying affordable improvements that make a big difference is a smart way to go. Some less expensive projects that can add a high percentage to your home’s resale value include:
- Renewed landscaping: You can only have one first impression and a little lawn care can go a long way. With an average return near 100 percent, landscaping can be a great investment. Trim or eliminate overgrown trees and shrubs to create more space and let in more light. Replacing stale plants with fresh, low-maintenance perennials such as grasses or ground covers will update the look without much cost. The key is to keep it simple. A well-kept lawn is appealing, but don’t expect excessive embellishments like exotic plants or elaborate fountains to hold their value.
- Updated entranceways: New front doors make a dramatic impact on your home’s curb appeal with minimal cost. Statistics show that replacing an existing entry door with a steel one returns about 91 percent at resale. Many buyers appreciate the energy efficiency, low maintenance, and insulating powers of metal. They’re also considered a crucial feature for potential buyers focused on home security, since steel doors outperform wooden doors by a ratio of 7 to 1. Painting or faux-finishing can enhance the appeal of any lackluster door. Outdoor light fixtures and house numbers can also be updated easily and inexpensively, as can mailboxes.
- New kitchen and bath fixtures: Replacing outdated faucets and handles can make an older home seem more up to date for a minimal cost. New drawer knobs, pulls, and spigots in a matching style give a room a cohesive, modern look, and this minor, inexpensive upgrade alone can have a big impact on buyers. Try brushed nickel fixtures for a contemporary style, or oil-rubbed bronze if your home has a more traditional appearance.
For larger projects, get expert advice. Start by consulting with a realtor in your area or an online guide such as Remodeling’s annual cost versus value calculator: https://www.remodeling.hw.net/cost-vs-value/2019/. This helpful resource provides the average costs for specific geographic regions, along with the estimated percent recouped at resale. Five larger projects in the Baltimore-Washington area that offer a high resale value include:
- High quality garage doors: A garage door upgrade is an inexpensive way to update your home’s exterior while producing measurable ROI. You can give your home an entirely new look with a modern garage door that will provide plenty of additional benefits, including increased energy efficiency and improved security. A new garage door practically pays for itself, recouping about 98 percent of the cost at resale.
- Converting an attic into a bedroom: Converting an attic into living space is far more cost-effective than physically adding on space due to the expense of the foundation and framing. The average attic bedroom in a two- or three-bedroom house costs $39,188 and returns $36,649 at resale, or a 93.5 percent average return. Add extra insulation to lower your utility bills.
- Replacement windows: Replacing ten standard size windows runs about $10,000, on average. Expect to get $9,000 back when you sell, for a recovery rate of nearly 90 percent. To maximize energy efficiency, choose windows with argon gas inside the pane to prevent heat and cold transference.
- New siding: Replacing siding is one of the most inexpensive major projects to improve the appearance of a home's exterior. At an average total cost of $10,000, this low-maintenance remodeling effort can make a residence look virtually brand new. On average, siding adds an 80 percent return at resale and lasts for up to twenty-five years.
- Adding a deck: Adding a 16 x 20 foot pressure-treated wood deck costs about $11,000, on average. At resale, you’ll get about $10,000 of that back, a recoup rate of 90 percent. Enhance your deck’s appeal by adding colorful decorative planters and some attractive outdoor furniture.
It pays to make smart renovation choices and keep their return on investment in mind.
As with any financial decision, proper planning and research can help improve your quality of life along with your net worth, while helping you avoid big mistakes along the way.
If you have questions or are in need of additional guidance to maximize your property’s value, please reach out to our knowledgeable professionals today.
About FAI Wealth Management, Inc.: Located in Columbia, Maryland, FAI focuses on helping clients create the financial future they desire by protecting their wealth, making the most of their assets, and planning for life's uncertainties. The firm combines fee-only, fiduciary-driven guidance with highly personalized, consultative financial planning and investment services that enable individuals, families, and businesses to navigate complex life transitions. Founded in 1987, FAI currently manages more than $350 million in client assets nationwide. For more information about FAI Wealth Management, please visit the website at https://www.faiwealth.com or call 410.715.9200.