Remodeling: What's it worth?

One of the important considerations before making the remodel decision is: what will the return on investment be when I sell? "Some remodeling projects can pay big dividends to sellers at resale."⁽¹⁾ Others may not. The seventh annual Cost vs. Value report recently published by Remodeling and REALTOR® magazines lists nine (9) of the most popular remodeling projects and compares the cost to the additional resale value added to a home in 53 major markets.

The following remodel projects included in the publication are:

• Major kitchen remodel
• Master suite addition
• Minor kitchen remodel
• Bathroom remodel
• Bathroom addition
• Attic bedroom/basement remodel
• Sunroom or deck additions
• Window replacement
• Siding or roofing replacement

The study reports that either a bathroom remodel in a mid-range valued home or a deck addition return greater than 100% of the costs in the Wasington DC Metro area. In general, according to this report, returns are greater in areas that experience rapid price appreciation. An independent analysis of the survey reports an error rate of ± 5-10%. While this study can serve as a general guide, there are many other considerations such as:

• Remodeling may be an alternative to selling if you are simply looking for larger space or more comfortable living conditions.
• Spending significant amounts on remodeling before a sale may not be worth it. Lower cost alternatives such as paint and/or new carpeting may be better.
• Your homes location, general condition and market characteristics are important elements in making the remodel decision.

When we work with sellers, we get to these answers through our needs assessment up front. If you love your house, love your neighborhood and have many close friends nearby, remodeling may be a better alternative to selling.