Despite the improvement in the overall economy, the real estate market has still not recovered. As result, many homeowners have decided not to sell their home and are choosing instead to remain in one place until the economy improves. In order to make the most of their investment, these homeowners renovate their homes to increase the value so that when the time comes for them to sell the property, they receive the most bang for their buck. Here are a few renovations that get the most return on investment.
1. Remodel the Kitchen
The average kitchen remodel can return between 60% and 120% of an investment in value. However, there is a point where their model reaches a point of diminishing returns. Rather than tearing out the entire room and installing an entire new kitchen (something which may cost as much as $60,000 or more), updating the cabinets or giving a new paint job may be the way to go period
2. Add a New Bathroom
If the home only has one bathroom, adding another half bath or full bath can greatly increase the overall value of the property. Estimates state that a homeowner can recoup 80% to 130% of the cost of adding a new bathroom. Real estate agents will also tell you that selling home is much easier when there is more than one bathroom available. Update to an existing bathroom, such as a new bath tub for a walk in shower, can also greatly increase the value of a home.
3. Improved Energy Efficiency
With so many people taking part in the ‘green’ movement today, adding energy efficient appliances and windows can greatly improve the resale value of a home. If the home is more than 50 years old, it’s likely that it includes single pane windows. These windows allow for a massive amount of energy loss; however, installing new energy efficient windows can result in energy savings of up to 75% or more. The cost of window replacements and an average home is between $7500 and $10,000. Even so, with the energy savings available, a homeowner can expect to make their investment back in just a few years’ time.
Although the initial investment in renovating a home might be high, the returns are well worth it. When you increase the overall value of a home, you increase the resale value as well. This allows you to ask a higher price when it comes time to sell than you might be able to otherwise.