Renovating your home costs money; no matter which part of the house you choose to improve, you should expect a decent investment. And renovating is not something owners can avoid; they have to do it from time to time. So how can you determine the added value of your home?
Renovating a home is essential for two reasons. Firstly, because of the pleasure and increased functionality homeowners get from the project. And, because it preserves the home’s value; as Windermere Management explains, installing modern features keeps the value of a property on par with or above its market value.
But this is only if the renovations you do add value to the home, from a buyer’s point of view. Not all home renovation projects will add value to the same extent. The particular project you choose determines the level of improvement in your home’s sales price.
Given that the two most sought after home renovations are kitchen and bathroom renovations, we will explain how these two projects can add value to your home.
How will a kitchen renovation improve your home’s value?
A great kitchen consistently makes it to the top of the list of things buyers look for when buying a home. Kitchens do more than serve as places for preparing or storing meals. They are social spaces and the focal point for many family interactions. So, it makes sense that focusing on updating this space will have an impact on a home’s value.
The cost of renovating a kitchen can run anywhere from $8,000 (for low-budget DIY projects) to $150,000 and up (for a total remodeling where the kitchen). The value of a kitchen remodel varies depending on the type of renovation and other factors.
How much value will it add?
Generally, you should expect to recoup around 60% of your costs when you sell your home. Some renovations will return up to 80% of the cost of the project. But very few projects produce 100% of the owner’s initial investment. Factors that affect ROI on a kitchen renovation include:
Cost: High-end renovations often have lower returns.
The condition of the rest of the home: Homes in good condition will naturally sell for more.
The list price: How much owners want for their home affects the project ROI.
Kitchen projects that add the most value
For returns of 80% and above, with low to medium project cost outlay, you may want to consider these simple projects.
Replace your hardware: Kitchen hardware can easily date and devalue a kitchen because they are one of the most eye-catching features in the space. Simply replacing old-fashioned and worn-out cabinet and plumbing hardware will immediately change the look of the whole area.
Reface or repaint cabinets: Because kitchen cabinets take up a lot of kitchen space, they dominate the area. If the cabinets look bad, they will cast a shadow on the whole kitchen. But kitchen cabinets are easily updated by repainting or refacing them.
Improve lighting: A well-lit kitchen looks better in every way. The lighting fixtures themselves serve as decorative elements. And the level of illumination can make the kitchen feel bigger and more vibrant.
How a bathroom renovation improves a home’s value
A bathroom is one of the most personal spaces in the home. People spend a lot of time in bathrooms taking care of their sanitary needs and grooming themselves. Naturally, buyers want a home where the bathroom is functional and inviting. And when a home’s bathroom meets those conditions, buyers are willing to pay more for the property.
The average amount of money that homeowners spend to make their home’s bathrooms more enticing varies. Location is a huge factor in the average cost of a low range bathroom renovation; depending on the area where the home is located, the cost will be between $17,704 and $30,378.
How much value will the project add?
Making changes to your bathroom will improve its value; how much depends on the specific project. Mid-range projects with standard features return 70.1%. Upscale projects that are more comprehensive and include high-end features return 56.2%. While a complete a remodel of the space returns 70.6%. But some projects with lower returns may help the home sell faster.
Bathroom projects that add the most value
Change the bathroom color: bathrooms with colors that are alluring and relaxing are more likely to win buyers’ attention. Additionally, bathroom colors can make the bathroom feel larger, brighter and airier.
Replace bathroom fixtures: Just as in the kitchen, plumbing and cabinet hardware matter in a bathroom. They can drag the bathroom down or lift it. A simple switch from outdated fixtures to modern ones can give the place a more luxurious appearance.
Upgrade the shower: Adding a rainfall showerhead with multiple flow settings and a glass shower enclosure is one of the cheapest ways to make a bathroom look more expensive.