If you watch home improvement or home-selling TV shows, you may think that a remodel will vastly increase the value of your home. Is a home remodel worth the investment? The answer is yes in some cases and no in others. If you want to sell your home and purchase another one quickly while interest rates are still low, it pays to know what remodeling projects will attract buyers and give you a good return on your investment.
If you are cash strapped, one of the best things you can do before selling your home is to focus on cosmetic or superficial projects. Buyers are likely to be turned off if they walk into your home and see cracked walls or dingy paint. Superficial fixes can range from replacing the light switch covers to adding new drawer pulls or knobs in the kitchen or bathrooms.
Focus on the outside
The first thing people see when they come up to your house is the exterior. Unsurprisingly, the home remodel projects that pay off the most tend to be those that are visible from the outdoors. One project that pays off well is adding a wood deck. According to Remodeling magazine’s 2014 Cost vs. Value report, in Atlanta, the average cost to add a wood deck was around $9,500. At the time of resale, the average value of a deck was over $11,000. The national averages for these costs varied, however, and not all areas saw a recoup.
Another exterior project that pays off when it’s time to sell your home is installing a new steel front door. In the Atlanta area, the average front door replacement project recouped 141 percent of the cost when the owner sold the home. Nationally, the average steel door replacement recouped about 96 percent of the cost.
Kitchen vs. bath
People typically think of bathroom and kitchen remodels as having the greatest payoff when it’s time to sell. If you can only choose one to focus on, your best bet is to pick the kitchen. A minor kitchen remodel costs an average of slightly less than $19,000 and has a resale value of just over $15,000, according to the nation 2014 Cost vs. Value report. A bathroom remodel only recoups about 72 percent of the original cost.
Choose what you do to the kitchen wisely to get the most out of your investment. According to the Cost vs. Value report, it was minor remodeling projects that had the greatest payoff. U.S. News and World Report advises spending no more than 25 percent of the home’s value on your kitchen remodel in order to get the most from the project.
Remodeling your home before you sell can pay off in the end. The key thing to remember is to pick your projects carefully and to keep an eye on the purse strings from the start of the project until the end.
Image source: Flickr