Some home renovations pay off at a much better rate than others, according to a report from ISoldMyHouse.com, a for-sale-by-owner website.
“Projects geared toward the homeowner’s particular tastes, like the addition of a home music studio, have the least positive effect on asking price,” says Owen Gilman, President of ISoldMyHouse.com. “Projects that most anyone can appreciate, such as a revamped bathroom, tend to boost sales price the most.”
Most everyone agrees that home improvements add value both for the present owners and for when it’s time to sell. In a survey from Sherwin-Williams and National Association of The Remodeling Industry (NARI), more than a third of homeowners (35 percent) view remodeling as the most efficient means of increasing home value.
But which upgrades make the biggest difference? Let’s look at those top fixes as ranked by ISoldMyHouse.com.
Replacement vinyl siding
It’s not what Laing would call a “sexy” update, but a $9,000 vinyl siding job can add $8,000 to a home’s asking price when it comes time to sell, an 89 percent return on investment (ROI).
Major bathroom remodel
Among those surveyed by Sherwin-Williams and NARI, the bathroom is the top choice for a remodel. A bathroom overhaul costing $13,000 can add $11,000 to a home’s asking price, an 85 percent ROI.
Vinyl replacement windows
Windows are a functional update that are not so noticeable visually, but are much appreciated for improving energy efficiency. A $10,000 expenditure on new windows can bump up an asking price on a house about $8,500, according to ISoldMyHouse.com, for an 85 percent ROI.
Major kitchen remodel
In a survey commissioned by MasterBrand Cabinets, 27 percent of homeowners planned to spend between $10,000 and $24,000. And 35 percent of those remodeling kitchens were doing so to invest in the long-term value of the home. Homeowners who shell out $54,000 on a kitchen remodel can count on adding about $44,000 to their home’s asking price, for a 81 percent ROI.
A renovated basement can become an in-law suite, add guest or family bedrooms or even bringing in rental income before the home is sold. (See the CNBC slideshow: In-Law Suites) A basement remodeling project costing $57,000 can add $45,000 to a home’s asking price, for a 79 percent ROI.
Spending $14,000 on a new roof can add curb appeal and up the asking price by $10,500, for a ROI of 75 percent, says the ISoldMyHouse.com report.
A new deck is impossible to forget when potential buyers are touring a home, and for those costing about $15,000, they add about $11,000 to the asking price, for a ROI of 73 percent.
Smart renovations don’t always guarantee results, of course. Everything depends on the current real-estate market. Despite improvements, houses may be listed for less than their purchase price.