While we primarily focus on remodels to benefit our clients while they live in the home, it’s impossible not to receive questions on the return of the investment their making.
Whether you’re changing the size, layout, function or even finished in a room, you’re affecting the value of the home and the price the next homeowner will want to buy it for.
One of the reasons we don’t focus on return during the remodeling process is that we want out clients to really enjoy the home while THEY are living in it and not to do the remodel to suit some other person’s needs.
On that note, with the stock market volatility the past few weeks, some investors are looking to diversify their portfolios and real estate is a great option because homes (and other tangible items) are more likely to hold their value. If you’re looking to invest in real estate, there are a few main ways you can do it:
Fix and Flip – fix up a home and then resell it immediately
Fix and Hold to Rent – fix up a home and then keep it to rent out to tenants either long or short term
Fix and Hold to Live In – fix up a home and then keep it to live in it yourself
This amazing chart from fixr.com shows 21 common remodeling projects and their average ROI for the year of 2018.
We are certainly not surprised that additions are so high on the cost to value list, adding extra square footage or even extra functionality without the added space, makes a home more appealing to the wider audience. Many families in America would like at least a 3 bedroom, 2 bathroom home – that’s been true for decades now. So, if you have a 2 bedroom or a single bathroom home, adding some walls within or taking more space from the yard to give to those extra rooms could be the biggest bang for your buck!
Those big returns come with hefty price tags though, so if your budget is under $17,000 for your remodel, the chart indicates that many exterior features have the highest return – changing the curb appeal of the home by changing the siding or entry door can have an impact as well as adding usable space to the backyard with a deck can see your return increase.
If you have any questions about what changes you can make to your home to increase the price you could sell it for, reach out today and let’s get that conversation started!