Whether you’re selling your house or want to enhance your current lifestyle, remodeling your living space can increase property value. You can make subtle, cost-effective changes, like remodeling your bathroom, to make your property more appealing to guests. This guide features some of the best renovations that add value to your home.
Can Renovating Your Home Bring a Return on Investment?
According to Remodeling’s Cost vs. Value Report, these are the home renovations that add the most value in the Pacific region.
- Remodeling the kitchen: The kitchen is usually the home’s focal point because it’s where you do your cooking and entertaining. When you create a cooking space with modern amenities, you can make everyday activities much more convenient. Even updating the paint color or investing in new appliances can yield a return on investment of 86.6%. Consult your kitchen remodeling options with your contractor to get the most bang for your buck.
- Adding a deck: Making efficient use of your outdoor living space is equally as essential as your home’s interior, especially if you live in an area with pleasant weather throughout the year. When you install a deck on your property, you create additional space for entertaining guests. A deck addition with natural wood results in an ROI of 77.1%, while using wood composite recoups about 70.6% of the cost.
- Updating the roof: Investing in a new roof can enhance your home’s curb appeal and fix any leaks on the top of your property. A roofing replacement with asphalt shingles produces a 75.3% ROI, while one with metal yields 65.4%. Potential homebuyers will appreciate you making this renovation before putting your house on the market. Even if you don’t plan on selling your home soon, updating your roof with energy-efficient materials reduces your energy costs and saves you money over time.
- Installing new windows: Though it’s not a luxurious home renovation that adds value, updating your worn-out windows can make your property more energy-efficient and appealing to potential homebuyers. When you install vinyl windows, you can recoup about 74.5% of your costs, but wood frames produce an ROI of 72.9%. The trim should complement your home’s existing siding. Consider getting energy-efficient windows that help you save money in monthly utility costs over time by preventing air leaks and solar infiltration.
- Remodeling the bathroom: The scale at which you upgrade your bathroom depends on your lifestyle needs and whether you want to sell the house. You’ll get the most value out of your bathroom remodel if you feature a universal design, which makes it suitable for people of all ages, abilities and sizes to use. With this design, you’ll recoup 66.1% of the renovation costs. A mid-range bathroom remodeling project produces an ROI of 66%, and an upscale one yields 54%.
- Adding a new bathroom: A luxurious bathroom will attract potential homebuyers, but it also pays to install a bathroom for guests to use. A mid-range bathroom addition results in 58.9% ROI, and an upscale one recoups 56.4% of your costs. Whether you should install a modest powder room or a spacious bathroom with a shower depends on your design and lifestyle preferences.
- Creating a master suite: Besides installing a new bathroom, you can also add a master suite to your home to increase its value. A mid-range master suite addition results in 65.2% of recouped costs, while an upscale design yields 55% ROI. Consider making a master bathroom with a whirlpool tub and a walk-in closet with plenty of space for storing clothes, shoes and accessories.
How Home Renovations Increase Your Resale Value
Renovating your home helps enhance your lifestyle, but it also comes with financial benefits.
- Increased equity: When you get your home value assessed, the property appraiser will consider any renovations you’ve made recently into account. As the value of your home increases, you’ll have more equity, which gives you an asset to use for debt consolidation and other purposes.
- Reduced private mortgage insurance: If you took out a loan and put less than 20% down, you must pay for PMI along with your mortgage. However, you can apply to have this additional payment removed from your account if the principal balance is 80% or less of your home’s original value. Since you earn equity and increase value with home renovations, remodeling your house can decrease the amount of time you spend paying PMI.
- Increased resale value: Potential homebuyers enjoy move-in-ready homes with clean, modern updates. If you’re trying to sell your property, your home needs to stand out among the others in your surrounding area. These upgrades will attract your target market and allow you to earn more on the sale of your property.
How Much Should You Invest in Home Renovations?
The amount of money you put into your home renovations depends on how much you’re willing to spend and what value you want to get out of the project. To stretch your dollars further, consider remodeling projects that add value to your home. As you develop a budget, remember that costs fluctuate depending on the region you live in because contractors will charge for labor, materials and high-quality service.
Tips for Remodeling Your Home
As you think about renovating your living space, keep these tips in mind.
- Determine your wants and needs: As you create your budget, you’ll either cut back on costs or splurge in some areas. Spend the most money on the parts of your house you use most frequently. If you’re on a tight budget, consider cutting back on cosmetic finishes you can make in the future.
- Make decisions beforehand: You should have most of your supplies picked out and ordered before you begin construction. Once the renovation starts, you’ll have to make many little decisions, so it’s better to go in with as much information as you can.
- Consider your home’s existing conditions: Your home’s current conditions can change what work is necessary when renovating. For example, you may think you need to add an outlet, but you might need to rewire your house’s whole electrical system, especially if you often blow a fuse.
- Hire a reputable contractor: Your project’s contractor should have the proper credentials for doing work in your area. Ask trusted friends and family members for recommendations, and get multiple estimates to make sure you’re getting the best value for your money.
Hire Daniel’s Development Group for Your Next Home Remodel
Daniel’s Development Group is a reputable design-build contracting team specializing in renovating homes in the Los Angeles area. When you trust us to handle your remodeling project, we’ll manage the whole process from design to construction. With our extensive experience in the construction industry, we’ll help you consider the renovations that add value to your home to determine how to upgrade your property. Contact us to get started on increasing your home’s value today.