Cost vs Value - Home Improvements

Are you are thinking of selling your home in 2012 - or know someone who is? Are you wondering what improvements will bring the best return on your investment? According to the National Association of Realtors, improvements on the exterior, kitchens, and baths bring the most “bang for your bucks”…

When it comes to remodeling, “exterior replacement projects have routinely rewarded homeowners with more bang for their buck. This year is no different, as Realtors® recently rated many exterior improvements as among the most valuable home investment projects as part of the 2011-12 Remodeling Cost vs. Value Report.

“This year’s Remodeling Cost vs. Value Report shows the value of putting your home’s best façade forward, so to speak,” said National Association of Realtors® President Moe Veissi, broker-owner of Veissi & Associates Inc., in Miami. “Inexpensive exterior replacement projects are not only crucial to a home’s regular upkeep, but are also expected to recoup close to 70 percent of costs. Specific exterior projects such as siding, window and door replacements are part of regular home maintenance, so many homeowners are already undertaking them. These projects also do not require expensive materials and they have the added bonus of instantly adding curb appeal.”

According to the Cost vs. Value, seven of the top 10 most cost-effective projects nationally in terms of value recouped are exterior replacement projects. Realtors® judged an upscale fiber-cement siding replacement as the project expected to return the most money, with an estimated 78 percent of costs recouped upon resale..”

Two additional siding replacement projects were in the top 10, including foam-backed vinyl siding, expected to return 69.6 percent of costs, and upscale vinyl siding, expected to recoup 69.5 percent of costs. Three door replacements were also among the top exterior replacement projects. The steel entry door replacement is the least expensive project in the report, costing little more than $1,200 on average and expected to recoup 73 percent of costs..”

The upscale garage door replacement jumped seven spots to number six this year, primarily due to the average cost of the project declining more than 15 percent nationally. The upscale and midrange garage door replacement projects are expected to return more than 71 percent of costs. One window replacement project – upscale vinyl – rounded out the last exterior replacement project in the top 10, expected to recoup 69.1 percent of costs..”

The 2011-12 Remodeling Cost vs. Value Report compares construction costs with resale values for 35 midrange and upscale remodeling projects comprising additions, remodels and replacements in 80 markets across the country. Data are grouped in nine U.S. regions, following the divisions established by the U.S. Census Bureau. This is the 14th consecutive year that the report, which is produced by Remodeling magazine publisher Hanley Wood, LLC, was completed in cooperation with NAR..”

Realtors® provided their insight into local markets and buyer home preferences within those markets. Overall, Realtors® estimated that homeowners would recoup an average of 57.7 percent of their investment in 35 different improvement projects, down from an average of 60 percent last year. Due to a weak economy, high unemployment in the construction industry and the increasing cost of materials, the price of remodeling projects have risen, leaving many homeowners hesitant to tackle projects or encouraging them to scale back on their plans..”

Three interior remodeling projects are also considered worthwhile investments. A midrange attic bedroom is expected to return 72.5 percent of costs upon resale; of all the projects in the report, it is the least expensive way to add a bedroom and bathroom within a home’s existing footprint. A minor kitchen remodel, expected to return 72.1 percent of costs, is fourth overall, ranking two places higher than last year. Nationally, the average cost for the project is just under $20,000 and is the least expensive way to give an existing kitchen a complete facelift. A wood deck addition, landing at number seven overall, is expected to recoup 70.1 percent of costs. Improvement projects that are expected to return the least are a sunroom addition and a home office remodel, both estimated to recoup less than 46 percent of costs..”

“Resale value is just one factor among many that homeowners need to take into account when making a decision to remodel,” said Veissi. “The desirability and resale value of particular remodeling projects also varies by region and metropolitan area. A Realtor® can help homeowners decide what low-cost improvement projects will provide the most upon resale in a particular market.”.”

You can find summarized results of the report on http://www.houselogic.com/. This website also includes a wide variety of ideas and projects to help homeowners maintain, enhance and improve the value of their homes.

For full project descriptions and access to national and regional project data, visit http://www.costvsvalue.com/.

I hope you find this information beneficial. Remember though, real estate is local so be sure to consult a Realtor in your area for added expertise on preparing your home for the market.  Let me know if you have questions or comments.