Homeowners: Don’t do that, do this
Every homeowner wants to update and improve their home. But some renovations and improvements can make a big difference in the potential resale price of a home while others don't. Here are some expert tips on the improvements you should make versus the ones you should avoid.
Let's be honest, everyone wants their own bedroom. But what makes more sense, renovate an existing bedroom or add a new one?
DON'T: Add a new master bedroom suite.
While this project might make waking up every morning a little bit easier and more enjoyable, it doesn't make as much sense from an investment standpoint.
According to Remodeling magazine's Cost Vs. Value Report 2011-12 (© 2011 Hanley Wood, LLC.), the average master suite addition cost over $106,000, but only adds $62,874 to the resale value of the home. That puts it at the bottom of Remodeling's list for return on investment along with a sunroom addition and a home office remodel. All of these projects will add to your home's resale value, just not enough to offset much more than half of their high cost.
DO: Turn an attic into an extra bedroom.
Remodeling's report estimates that an attic bedroom will set you back just over $50,000 on average. However, this additional sleeping space can add over $36,000 to your home's resale price, allowing you to recoup 72.5 percent of the cost -- a far better return on your investment
If you're planning on selling your home, your property's exterior is a potential buyer's first impression. That said, some curb-appeal improvements are more cost-effective than others.
DON'T: Overpay for a front door.
You can spend more than $8,000 on fiberglass doors that can make your entranceway look like a castle gate. But in tough economic times, homeowners have a more cost-effective option, says Steve Melman, director of economic services at the National Association of Home Builders. (Photo at right courtesy of Pella® Windows and Doors.)
DO: Install a steel replacement door.
One of the most effective returns on your investment is to install a secure, attractive front door. Your front door, like your landscaping and paint job, is what potential homebuyers notice first from the curb. Melman says some potential buyers may bypass your home entirely based on the look and condition of your front door.
According to Remodeling's report, a new steel entry door can cost upwards of $1,200, but will add an average of $900 to the resale value of your home. A fiberglass replacement door costs an average of $3,536, while recouping only 56.3 percent of the cost. New garage doors are another solid investment, Melman says, recouping close to 75 percent of their cost.
Who doesn't want a new kitchen? But when it comes time to upgrade, is it best to go all out or simply make a few cosmetic upgrades?
DON'T: Expect a big return from a new kitchen.
Full-scale kitchen renovations cost a lot, but typically add less than two thirds of that cost to a home's resale price, says Deb Kearse, vice president for Kohl Building Products in Reading, Pa.
DO: Concentrate your efforts on highly-visible finishes.
A nice light fixture can make a big difference on how your home appears to prospective buyers, says Michael Labout, branch broker for ERA Shields Real Estate, in Colorado Springs, Colo.
"Granite countertops are becoming the standard," says Labout. The cost of granite is now about a third of what it was just a few years ago. Stainless-steel appliances are favored over all other colors, he says. "You could have the best black Bosch dishwasher in the world -- for most buyers the perceived value will be higher with a stainless steel Whirlpool," says Labout.
New windows might not be the most glamorous improvement you'll make to your home, but they just might be the most practical.
DON'T: Replace old windows with cheaper, inefficient windows.
If there are new homes for sale in your area, chances are potential homebuyers have had to listen to a real estate agent's spiel on the new home's energy-efficient features. That said, don't be surprised if a potential buyer grills you about the insulating value (otherwise known as the "R-Value") of the new windows you just installed. (Photo at right, Andersen EcoExcel 400 Series Double Hung Window, courtesy of © Andersen Corporation.)
DO: Chose energy efficient windows.
If you're planning to replace your windows anyway, consider paying a little extra for energy-efficient windows. The windows cost a little more, but they'll save you on energy costs and can pay for themselves in as little as four years.
Go big when going small
If you can't afford a large-scale improvement project, you can still add value to your home by simply taking basic home improvements one step further.
So, if it's time to replace the siding on your home, consider upgrading from vinyl siding to durable cement fiber board or adding a layer of continuous insulation under the siding. If it's time to replace plumbing fixtures, consider water-saving faucets that can help cut your water bill. These upgrades add to the resale value of your home while saving you some money on your utility bills in the meantime.
Related articles :
More help from HSH.com
HSH.com on the latest move by the Federal ReserveThe Federal Reserve concluded a meeting today with a no change to the federal funds rate, but announced the start of Quantitative Tightening (or at least Quantitative Tapering) of its massive balance sheet.
10 best states for home buyersHSH.com recently created a database of the home-buying-assistance programs in every state. From that database, we have assembled a list of the states which offer the most robust set of programs to its residents.
Home price recovery index: Which metros have improved the most, least?Have home prices in your area fully recovered from the declines suffered during the Great Recession, or are they still struggling to make it back to the peak it reached before the crisis?
10 metros where a home costs about $1,000/monthHSH.com identifies 10 metro areas where you can afford the principal, interest, taxes and insurance payments on a median-priced home for only around $1,000 per month.
The salary you must earn to buy a home in 50 metrosHere’s how much salary you would need to earn in order to afford the median-priced home in your metro area.