6 home improvements with big resale value
Shannon Lee | Improvement Center Columnist | March 20, 2012
The economy is slowly recovering, but many homeowners are wary of jumping into the real estate market. As a result, they are choosing to stay home and remodel their properties. Forty-two percent of homeowners feel it is a great time to remodel, according to the recent Hanley Wood Housing 360 report. With project costs dropping, now is the time to look into remodels that can offer a maximum return on investment.
What are those remodels? The Remodeling Magazine's Cost vs. Value report for 2011 - 2012 offers some insights into home improvement projects that are hot right now.
1. Open the door to curb appeal and security
"Good front entry doors may not sell a home, but bad doors do not afford a good first impression," said Rodney Powell, a residential real estate broker in the Houston area. "Many home owners use the back door near the garage or driveway, so the front entry is an often-neglected area that deserves attention."
A brand-new entry door can impress potential buyers. If you're not sure of the material, consider steel -- it offered a 73 percent return on investment, while fiberglass offered only 56.3 percent. At a national average of just over $1,200 for a steel entry door, the initial investment can fit into some of the tightest budgets, making this a winning option among home improvement projects.
2. Turn your attic into a bedroom
That attic space is just sitting there, so why not use it? Create a new bedroom and bath in the existing footprint by adding new windows, a closet under the eaves, finished ceiling and walls, and carpet on the floor. Run an HVAC duct, add a rail to the existing stairs and you've got a brand-new space.
Though an attic bedroom is one of the most expensive home improvement projects at a national average cost of just over $50,000, it remains a very popular option, ranking in the top 10 among projects reported by Remodeling Magazine over the last three years.
3. Cook up a minor kitchen remodel
The minor kitchen remodel has long been considered an excellent return on investment. At a national average cost of just under $20,000, the remodel includes cabinet refacing, new energy-efficient appliances, new countertops, fresh flooring and a new paint job.
When it comes to kitchen remodels, less is more. The mid-range minor kitchen remodel offered a 72.1 percent return on investment, vastly outperforming the upscale kitchen remodel, which might recoup only 57.4 percent of the more than $110,000 national average cost.
What if you have a very limited budget? "Some minor fixes are usually cost effective," says Powell. "For example, you should ensure sink plumbing and appliances are working properly. These are common items that appear on inspection reports and they are usually easily cured in advance."
4. Fiber cement siding looks great and lasts
Covering your home in fiber cement siding offered the highest potential recoup value in the Cost vs. Value Report at 78 percent. Though the cost recouped has dropped slightly since 2005, the return on investment is still impressive. Besides the bottom line, there is also the curb appeal and longevity -- most fiber cement siding comes with a warranty of 50 years or more.
"I'm a huge fan of cement board siding," Powell raved. "We have HardiPlank siding on our home. It is low maintenance, looks great and is functional."
5. Treat your car to a new garage door
Though a garage addition doesn't offer much return on investment, a new garage door is a different story. If you already have the space to tuck your car away, simply replacing the outdated door with a new four-section garage door on galvanized steel tracks can result in an average of 71.9 percent return on investment. You get to use the existing motorized opener for added savings.
6. Decked out space is very much in
One of the biggest trends of 2012 is creating cozy, livable outdoor spaces. A deck addition can provide plenty of space for entertaining, add to the curb appeal of your home and allow you to recoup an average of 70.1 percent of the cost. Keep in mind that wood outperformed composite materials in the Remodeling Magazine Cost vs. Value report; composite offered an average recoup of only 62.8 percent.
Don't go overboard
"If home owners are preparing to sell, the key word to remember is 'minor'," Powell advised. "Be careful about over-improving unless it is for your own enjoyment and appreciation. Prospective buyers do not care how much sellers' improvements cost to enhance the property."
The best home improvement projects should make your home more comfortable and appealing, as well as provide some return on investment down the road. Whether you are going to stay there for another decade or put your house on the market within a year, these six home improvement projects are smart moves.