Best 2014 room additions for ROI: consider your location

Iris Price | Improvement Center Columnist | February 26, 2014

You've outgrown your home, but you don't want to move.

Expanding your present home or remodeling to repurpose the existing space could be the solution. Home improvements in 2014 continue to provide a bigger percentage of return on investment over previous years. According to Remodeling Magazine's Cost vs. Value Report for 2014, the nationwide median return on investment in every category of remodeling projects has increased over what it was last year.

Take a look at the median ROI for these popular room additions and home expansion projects across the country:

Room Addition



ROI 2014

Attic bedroom




Basement (finished)




2nd story








Family room




Master suite




Luxury bath addition




Midrange bath








In some regions the return is even greater. In New England, for example, the median, region-wide ROI to add an attic bedroom is 87 percent, and on the West Coast the return is 102 percent. In some regions like the Midwest the returns are typically several percentage points less, but the housing market can vary a lot between localities within any region.

Adding square footage? Get a professional opinion

When you begin considering a remodeling project that either adds square footage to your present home or remodels your current space for more efficient use, start by consulting a professional. A seasoned Realtor, for example, should know the value and sizes of the homes in your neighborhood. When it comes to how much you hope to recoup when you sell, they can tell you how your proposed additions stack up against comparable homes. To gauge your return on investment, you need to know what your competition's got to offer prospective home buyers. Like Goldilocks, you don't want your home to be too big or too small but just right for the community.

Marcy Spieker, a Realtor since 1991, is currently managing broker of RE/MAX Metro Realty in Seattle where the market for houses is, as she describes it "robust." However, Spieker warns against "…improving so much, that your features and benefits are distinctly better than those of similar homes. You want to be in conformity with other homes in your area."

Some home additions are a no-brainer if you can afford them. She recommends adding a second bathroom if you only have one. Regardless of the median ROI for bathroom remodels she says, "A single bath home is always overlooked in favor of multi baths." In her market she advises that "kitchen and bath remodels will usually pay off equally to what you put in" and that "adding an attic bedroom will bring slightly less than what the cost runs."

Ren and Susan Snyder, of The Snyder Group at Reinhart Realtors in Ann Arbor, Mich., have been Realtors for more than 20 years. While other areas of the Michigan housing market are still depressed, Ren Snyder says,"Ann Arbor and immediately surrounding communities in Washtenaw County have always been somewhat more buffered from downturns than the rest of Southeastern Michigan because of the University…" That has worked to the Snyders' advantage with their own home improvement investments.

In 1983 they purchased a 1950s home for $72,000. Over the next 30 years, they invested $250,000 to remodel the home to their liking. They enlarged it from 1,500 square feet to 2,300 square feet and "added a master bedroom suite with walk-in closet, master bath with heated floor, walk-in shower and euro style towel warmer." They also raised the ceilings, enlarged and remodeled the tiny kitchen "with Viking stainless steel appliances, hardwood floors, custom, alder wood cabinets, and granite counters" as well as expanding into the area once occupied by a screened porch to further open up the home's living space. In 2006 the Snyder's home was featured on HGTV's What You Get for the Money. At the end of 2012 they sold it for $500,000.

Adding more kitchen or bathroom space by building out or expanding into under-utilized areas of your home can also give you a good return on your investment in New England. June Vigliotto of Berkshire Hathaway Home Services New England Properties specializes in shoreline properties from New Haven to Old Lyme, as well as other communities in Middlesex County, Conn. Her top recommendations in that market are to add more bedrooms and baths.

Vigliotto adds, "Finishing basements or attics are a good investment. A remodeled kitchen is a big selling point…A garage or room above a garage would be the next best investment. Adding an all-season porch with heat…any addition that adds year-round living space is a plus." She also echoes Spieker's advice: "The main thing is to stay within your neighborhood's price range. If you're in an area of lower-priced homes, don't waste money on big bonus rooms or expensive extras like granite counters, heated floors, or big, elaborate bathrooms."

To recalculate your new square footage, particularly when it comes time to sell your home, you can only include indoor living space that is inhabitable -- properly enclosed, heated, and air-conditioned. Before you officially market your home, consult with an experienced property appraiser familiar with your area. She or he can determine the extent to which your additions qualify as "inhabitable" space and calculate your home's new value.

About the Author

Iris Price is a single Baby Boomer whose antidote to a lack of retirement funds was to launch a long-delayed career as a writer. While others her age concoct bucket lists and travel the world, she bought a new-construction home and obsessively creates lists of must-have home improvements and personal realization goals. She specializes in writing about home services and self-motivation.