What Kind of Home Improvements Deliver a Good Return?
Sep 16, 2015
We’ve previously advised that siding replacement — a more basic home improvement solution — can provide a better return on your investment than, say, a large-scale bathroom remodel. We recently came across an article on HGTV by Kathy McCleary that validates this observation. This post shares some key points on the returns from different kinds of home improvement initiatives.
1. Home aesthetics of course matter to potential home buyers. But don’t expect them to forgive a leaky roof for a plush bathroom with luxury bells and whistles. Buyers want the basics to be perfect, whether that means reliable plumbing or an optimally-functioning air-conditioning system. That’s because they realize that maintenance costs can add up quickly and lighten their wallets. Here’s what Remodeling Magazine has to say:
- Siding replacement can recoup up to 92.8 percent of its cost
- Roof and window replacement can recoup up to 80 percent or more
- Adding manufactured stone veneer returns up to 92.2 percent
- Replacing the front door returns up to 101.8 percent
- Replacing the garage door returns up to 88.4 percent
2. Homeowners must focus on maintaining the existing structure of their property in good shape. There is little advantage to spending a couple of grand in remodeling the kitchen if your basement smells musty because of a water leak from the foundation. The average buyer has this mindset : “Why should I have to spend money on maintaining the basic systems that the seller hasn’t bothered to care for? If the basic systems are fine, then I can upgrade the kitchen or bathroom myself when I have the cash flow for it. It’s a desire but not an urgent need.” According to a study by the Joint Center for Housing Studies, Harvard, 30%-40% of buyers of existing homes made home improvements within six months of their purchase.
3. Curb appeal — the exterior appearance of your home — is an influential factor determining whether or not buyers will be attracted to your property in the first place. The facade of your home is the first thing that people see and potential home buyers observe. If the exterior look of your home doesn’t grab eyeballs or even glances, you’ll never get the chance to show buyers the interior.
This is the reason why siding replacement is considered a good bet in terms of returns from your property. Additionally, replacement siding is also regarded for its rugged durability and low maintenance, which is especially important for cost-conscious buyers.
