Not all home remodel projects are equal
when it comes to how they will impact the price of your home when you put it on
the market. While it may seem logical that endeavoring a large home addition
like a master suite or installing an in-ground pool should increase your home’s
value and pay dividends on those remodeling costs, that is not always the case.
The return on investment (ROI) of your next home remodel is easy to calculate,
and something that you can also get help with from your local home remodeling
contractor.
In order to determine the ROI on a home
remodel, you must first get an idea of how much the
project will cost. Next, you should
determine how much that completed project will add to your home value. Lastly,
you divide the increased value by the cost of the project. For example, you
have decided to conduct a foundation repair on your home. That project will cost you $2,000. Having a
newly repaired foundation will also increase your current home value by $2,500.
This project has the potential ROI of 125% (2,500 / 2000 = 1.25). In the scheme
of home remodels, this math is very favorable; however, it is not always what
remodel ROI can look like.
Best ROI Remodels
Big, transformative remodels can be the
more exciting type of project, and also tend to be the more expensive ones. The
price tag on these remodels can make it hard to make your money back when your
house goes on the market, and can sometimes be a polarizing feature for some
buyers, like the aforementioned pool. The smaller, less expensive projects on
the other hand, can have the best ROI for
remodels and can be easier to
undertake. For example, simply adding or replacing insulation in your attic can
have a 117% return on investment. Updating your entry doorway with a steel door
has a 91% ROI, while installing a modern and aesthetically pleasing garage door
can have a 90-91% ROI, depending on the type and cost of the door. In contrast,
a deck addition or an upscale master suite addition only has an ROI of 57%, and
a full bathroom addition has an ROI of 56%. Another type of remodel project to
keep in mind are those that increase the energy efficiency of your home. These
projects can also have a favorable return on investment and can reap financial
rewards for you even before your house goes up for sale.
Serving the Bay Area since 1983, Mares & Dow
Construction are home remodeling experts that also offer experienced general
contracting services. Contact us today to discuss your next home remodel project.
