It’s the ultimate question, right? What are the best renovations for high ROI – your return on investment? Whether you’re planning to sell your home within a year or five years, it’s good to know what updates will get you the biggest home value increase ahead of time. Here’s some trends for renovations for ROI we’re seeing a lot of this year.
BIG TICKET ITEMS
A well known renovation for ROI is the kitchen. Kitchens are without a doubt a high priority of every home for those living in the space and for those considering buying the home.
According to the experts, a minor kitchen remodel could cost anywhere from $20,000 to $30,000 on average if you’re using the original bones of the space. However, you could recoup roughly 75-80 percent of the cost. Kitchen trends come and go, but there are some key areas to target for a fresh cosmetic update: new countertops, flooring, appliances, and cabinets.
Need a lower cost and faster update option? These quick fixes can update the look of the kitchen and help you sell faster:
- Update backsplash tile
- Sand down and repaint cabinets
- Replace faucet and cabinet hardware pulls and knobs
- Update appliances to newer, higher efficiency models
Already on the rise pre-pandemic, but boosted with extra time at home, we’re seeing a huge amount of updates being done to outdoor spaces of homes. The main goal here is increasing the usability of the space.
A backyard remodel could include quite a bit. Adding an outdoor kitchen, sustainable landscaping, a new deck or a patio are all trending right now. Space dependent, choosing one or some of these things can really boost your home’s value. Be sure to think about your space realistically – don’t sacrifice all of your yard space just to build a pool, or landscape over all of your usable living space. The idea is to create new layouts and zones for multiple activities. A deck is another great zoning option – homeowners can typically spend $7-8,000 on a deck addition, with an average 75% return on investment.
The lower cost & faster update options here include:
- Adding a gazebo, pergola, or fencing to create shade and privacy
- Fire pits, portable heaters, and outdoor lighting help utilize the space further throughout the year
- Plantings or new sod can boost color quickly and can be inexpensive additions
In addition to outdoor usability, the value of the home goes up when curb appeal goes up.
Go all in with a garage door replacement, front door replacement, and siding replacement. New siding or exterior house painting clocks in as the most expensive of the three- you can spend an average of $10,000 or more. The near-perfect return on replacing a garage door – an average 97% return on investment is because it improves both a home’s beauty and functionality. Faulty garage doors can cause flooding, decrease your home’s energy efficiency and raise safety concerns. Garage door updates also function as aesthetic upgrades.
Even if you can’t do all of these updates at once, some quicker and less expensive updates include:
- Replacing the front door only – add curb appeal and increase efficiency of your heating and cooling
- Repainting shutters or window trim for a quick refresh
- Replacing older cracked gutters
SOME RENOVATIONS YOU CAN SKIP
While none of these renovation projects are necessarily a bad idea, they’re not as easily going to provide extra home value and a return on investment. Here’s some renovations for high ROI that aren’t actually that high:
- Dedicated home gyms: It’s one thing to carve out space for your Peloton, but another to fit out an entire room with gym-specific finishes. Most buyers are going to want the option of using that space as a bedroom or flex space, so in terms of seeing a great return on investment, avoid tying yourself down to a dedicated home gym. Stick with movable items that can be stored away when it’s time to list.
- Built-in desk spaces: While it’s obviously extremely important to show home office options, don’t go overboard with adding built-in desks and permanent workstations throughout your house. Again, the value is in showing that what is a home office right now could transition back to a bedroom once we’re going back into our offices a bit more. Instead, stick with freestanding office furniture that could be moved or tucked away easily.
- Above ground pools: especially large ones that take over the majority of your yard. Unless this is an addition you really want to add and live with for several years, it’s not going to be a great return on investment since it can be a turnoff to buyers and has a high cost to maintain.
Renovations for high ROI don’t have to be your main priority while you’re living somewhere, but if you’re considering selling, it’s good to use your money to the fullest. It’ll help when it comes time to sell! Good luck and happy renovating!
PS – This topic was featured in our Tuesdays at Two sessions! You can check out our full video below. You can also read our other posts if you need some outdoor ideas!