Grasp your surroundings before launching a home renovation projectDate posted: 3/23/15 07:15:00 AM
Giles Andrew understands the importance of adding value to a home. Andrew, the CEO of a European financial institution, told Property Wire homeowners should consider tackling a renovation project before they consider moving into a new property.
"With the latest housing market reports showing the market to be slowing down, home owners could add significant value by looking at ways to improve their current homes, rather than move," Andrews said. "With record low rates on borrowing, home improvements can be a cost effective way to add value to your property for the long term."
But what home improvement projects should be tackled?
It can be difficult for some homeowners to find the right renovation project for their home. Not only should the project be launched with return on investment in mind, but the renovations should also make the home cozier, more attractive or efficient to live in.
Whatever project a family chooses to launch, it's always crucial to do as much planning ahead as possible. The more solid the blueprint, the less likely homeowners will have to deal with renovation headaches down the line.
Understand the neighborhood and surroundings
Homeowners living in lower-income neighborhoods shouldn't try to price their home out of the market with a slew of luxurious upgrades, according to HGTV. After all, most people wouldn't pay up for a contemporary 3,000 square-foot home if it was surrounded by older homes with half the space.
Similarly, Americans living in upscale neighborhoods shouldn't skimp on costs when it comes to remodeling finishes. While low-end finishes might save the homeowner a few dollars on the initial project, it won't be able to net the same return on investment as a nearby home which better fits in with the neighborhood.
Some renovations are better than others
According to Remodeling Magazine's 2014 Cost vs. Value Report, one of the most popular renovation projects that homeowners continually see a solid return on investment from is a new front door or garage door.
The Cost vs. Value Report revealed a homeowner can get back 96.6 percent of the initial cost of replacing an old front door with a steel door at the time of resale. This project generally costs a homeowner $1,162, meaning the upgrade could improve a home's value by $1,122 when sold.
To calculate the report, Remodeling Magazine compared the average cost of 35 popular renovation projects in 101 cities across the nation with the value those projects earn at resale.
But with such a widespread list of cities, a renovation project in the Midwest might not recoup the same value as a project on the West Coast.
For example, in the Pacific region of California, Oregon, Washington and Alaska, an attic bedroom recovered 102 percent of the cost at resale, while a garage door got back 98 percent of the initial cost at resale.
In the East North Central region - which spanned Illinois, Indiana, Michigan, Wisconsin and Ohio - an attic bedroom addition regained 81 percent at resale and a new garage door recovered 83 percent.
This goes to show that some projects are more sought-after in particular regions, making it important for homeowners to look into what is popular in their area. An outdoor wooden deck won't be as sought-after in frigid Minneapolis as it might be in warmer cities.
Not all projects are created equal
Homeowners should steer clear of certain renovation projects. While it might be nice to have a sunroom added on to a home, a sunroom will only recover 51.7 percent at the time of resale. On a national average, a sunroom costs more than $73,000. Even in sunny Florida and nearby states on the Atlantic, a sunroom addition only recovered 53 percent of the investment at resale.
- Winterizing your home and finances - 12/12/17
- Retirement plan options - 11/29/17
- Best time to buy a car: December - 11/29/17
- 6 sustainable ways to save during the holidays - 11/9/17
- Steps that can help prevent identity theft - 11/2/17