Embarking on a home improvement journey can be exciting, especially when you think about the transformation and potential increased value your home will gain. The national average ROI for home remodeling projects is around 70%. But, as most homeowners quickly realize, not all home improvements yield the same ROI. So, where should you invest your time and money for the best return on investment for home improvement?
The best projects to boost your home's ROI
Giving your kitchen a facelift
A minor kitchen remodel can work wonders in enhancing the overall ambiance of your home. After all, the kitchen is the heart of the home, and potential buyers place great emphasis on its functionality and appeal.
Apply a new color palette and introduce new mirrors
A fresh coat of paint can do wonders for your home's appeal. Choosing neutral shades can give your space a modern feel, making it more attractive to most buyers. Adding new mirrors can create an illusion of more space and amplify natural light, making rooms appear brighter and more inviting.
Restore those wooden floors
Refinished hardwood floors offer elegance and a sense of timelessness. They can significantly elevate the look of any room, ensuring a high ROI on this home improvement.
Modernize with new fixtures
Simple changes, like new hardware for your cabinets or doors, can make a big difference in updating the look of your home without a complete overhaul.
Enhance the home's facade
Exterior improvements can drastically increase curb appeal, making the first impression a lasting one. Power washing the siding or brick can revive the look of a home, revealing its true colors and removing years of grime. A general tidy-up of the front yard, trimming overgrown bushes, and even ensuring a neat and crack-free driveway can entice potential buyers right from the beginning. Replacing or even just repainting the front door can also make a big difference. Remember, the home's exterior is the first thing potential buyers see, and ensuring it looks its best can set a positive tone for the rest of the viewing.
Liven up the outdoors
Garden landscaping is an art. With the addition of low-maintenance plants, you can offer potential buyers a beautiful view without the upkeep typically associated with lush gardens. Adding mature trees offers shade, possibly reducing cooling costs in the summer. Bushes and shrubs can add privacy and help demarcate spaces within the garden, creating separate areas for relaxation, play, or entertainment. Investing in outdoor space is an excellent way to create a warmer, more inviting atmosphere that extends beyond the home's interior walls.
Designate purposeful rooms
In the modern era, where work-from-home has become increasingly common, creating functional spaces is paramount. Maximizing the usability of every square inch can make a world of difference. Transforming a previously overlooked corner into a cozy family room or an office nook can add significant value. Potential buyers often look for homes that offer flexibility, and designating spaces for specific purposes can showcase the home's versatility and adaptability to various lifestyles.
Complete all levels
Leaving spaces like your attic or a dark and dingy basement unfinished can deter potential buyers who see them as missed opportunities or possible future projects. By taking the time to transform these spaces into usable living areas, you not only increase the square footage of your home but also its overall appeal. This can be as simple as ensuring proper insulation, adding lighting, or giving the area a fresh coat of paint. Potential buyers will appreciate the added living space and the effort you've put into ensuring every part of the home is livable.
Refresh the restrooms
The bathroom, often described as a sanctuary or personal spa, holds great value in the eyes of potential buyers. Whether it's a major overhaul or a minor touch-up, bathroom renovations consistently offer a substantial ROI. New fixtures, updated tiles, modern vanities, and even just a fresh coat of paint can breathe new life into an old restroom. Good lighting, functional storage, and modern fittings can transform a dated bathroom into a contemporary space, adding tremendous value and appeal.
Influential factors on ROI and resale worth
The neighborhood plays a crucial role. While your home improvements' return on investment may be substantial, the area's desirability can further increase or decrease the overall value. A well-maintained home in a sought-after community with good schools, convenient amenities, and low utility costs will naturally attract a higher resale price. Furthermore, the general upkeep of surrounding homes and the presence of community facilities can sway potential buyers' decisions. Most buyers prefer areas where there's a sense of camaraderie and shared pride in homeownership.
Regional preferences, climates, and local trends can dictate which renovations hold the most value. For instance, in colder climates, energy-efficient windows and well-insulated homes might offer a higher ROI than in warmer regions. Similarly, outdoor space developments like pools may fetch a higher return in sunnier states compared to places where such features can be used only for limited months. Being aware of the local preferences and tailoring your home renovations to suit these tastes can lead to a more significant boost in your property's value.
Prevailing property trends
The real estate market constantly evolves, and staying current on what's in demand can help guide your remodeling projects. By liaising with a local realtor or researching recent sales in the area, homeowners can identify what features or improvements are trending. For instance, open-plan living spaces may be popular now, but if the trend shifts towards designated functional spaces in the near future, it could influence potential buyers' preferences. Being adaptable and forward-thinking in your renovations can position your home favorably in the real estate market.
The longer a remodeling project takes, the more expenses you might incur, potentially reducing your return on investment. Delays can mean additional costs, be it in labor, materials, or alternative living arrangements, if the home becomes unlivable during the remodel. Time is of the essence in the world of real estate. If your home is off the market for an extended period due to ongoing renovations, you might miss out on selling at an optimum time when home prices are at their peak.
Every home renovation can come with unexpected issues or expenses. It's essential to account for these possibilities when calculating potential ROI. Older homes, for instance, might reveal structural problems, outdated electrical systems, or plumbing issues once walls are opened up. Budgeting for such surprises is crucial. It's always advisable to set aside a contingency fund, often recommended to be around 10-20% of the project budget, to ensure that your renovation can continue smoothly despite any unplanned obstacles.
Need guidance from a real estate professional?
With over three decades in corporate relocation, Anne Dresser Kocur stands as an authority in the real estate realm. If you're looking to buy or sell a home, want more insight into the best return on investment for home improvement, or have any questions about the Colorado real estate market, contact Anne Dresser Kocur today.