Home Improvement Return on Investment is Continuing its Upward Trend: Two Consecutive Years of Increased Value in 35 Home Remodeling Projects
Considering Remodeling? Looking to add Value to your Home? Home Improvement Return on Investment is Increasing Steadily
All data & percentages are according to the Remodeling 2014 Cost vs. Value Report (www.costvsvalue.com).
An increase in overall home improvement return on investment stats from one year to another is good. When remodeling ROI increases for two years in a row – and the housing market continues to show steady signs of improvement – then one can optimistically expect a positive trend in home improvement return on investment that should continue. Back in 2006 the cost-value ratio began a sharp decline that lasted over five consecutive years. In 2005 the average remodeling return on investment was over a whopping 85%. The next year it fell to 76.1% and it continued to decline until it bottomed out at 57.7% in 2012. Then home improvement ROI averages began to rebound: 60.6% the next year. And from 2013 to 2014 remodeling projects boasted an average return on investment of 66.1%.
Home Improvement & Remodeling: Biggest ROI Gains
Among some of the home improvement projects that sported the highest gains in return on investment are projects like attic bedroom remodeling, entry door replacement, new roofing, home office, bathroom, sunroom and basement remodeling projects. Basement finishing/remodeling sports a 77.6% return on investment: a one-year ROI increase of over 10%. For details about gains in home improvement return on investment per project, broken down by region, and much, much more visit Remodeling Cost vs. Value 2014 Trends.
Home Improvement ROI: Expensive Remodels or Affordable Projects?
With only a few exceptions, it was the less expensive home improvement projects that sported the highest return on investment gains. These mid-range projects out-performed the more expensive, upscale remodels when it came to boosts in ROI. All home improvement return on investments improved 10% on average, but “mid-range” home projects improved by 10.6% while “upscale” home improvements improved 8.8%. Per Remodeling’s Cost vs. Value report (www.costvsvalue.com) on 2014 ROI trends, “Many projects in the Cost vs. Value Report have two versions, “midrange” and “upscale,” with lower and higher costs, respectively, based on scope of work, complexity, and quality of finishes.” So homeowners will experience a higher ROI on home improvement projects that are not so “upscale”. For example, simple finishing of unused spaces like attics or basements, interior or exterior painting, etc. would perform better than a high-scale home improvement with more expensive materials.
Still, don’t go with the lowest bid when getting estimates for your home improvement project! Make sure you hire a contractor who uses quality materials and performs an improvement to your home that will last. For example, when it comes to kitchen and bath remodeling return on investments, the best-performing project proved to be a minor kitchen home improvement. According to the aforementioned report, this includes “new appliances and counter-tops, and a face-lift for existing cabinets. At $18,856, it is not the least expensive [kitchen and bath] project, but it delivers a lot of bang for the buck.” And in general, kitchen projects outperformed bathroom projects irrespective of cost. Although both kitchen remodeling and bathroom remodeling were recently reported as two of the most common remodels. Despite the return on investment of kitchen remodels outperforming bathroom projects, kitchen home improvements are slightly more popular (72% vs. 70% respectively – per NAHB article).
Morris County, NJ Homeowners: Contact CraftPro for a Home Improvement Return on Investment Consultation
We can discuss the best way that my team and I can improve your home with an increase in resale value in mind. Having worked with several realtors on boosting the value of homes, I know home improvement return on investment optimization.
View my Google Plus profile: Richard J. D’Angelo, founding owner-operator of CraftPro Contracting and author of this article. I take great pride in serving residents of my community. Check out CraftPro on Google+ and our online community of home improvement, maintenance and renovation professionals to learn more about home improvements.