One home renovation project gains steamDate posted: 2/13/14 10:15:00 AM
When a door closes, a window opens. That seems to be the case for a growing number of homeowners looking to tackle home improvement projects, as new window installation is one of the hottest renovations for families across the country.
Not only do new windows offer a clean look and energy efficiency, but they also provide solid resale value. According to Remodeling magazine's 2014 Cost vs. Value Report, homeowners can get back 78.7 percent of the costs of a mid-tier vinyl window installation when they decide to sell their home. Top-of-the-line vinyl window replacement offers a 76.6 percent recovery rate.
Additionally, wood window replacements offer similar value at the time of resale. Homeowners with a midrange wood window upgrade generally garner 79.3 percent of their costs. A premier wood window replacement nets about 74 percent of the cost at resale.
"Most people buy windows because their old ones are shot and drafty, and they know they're losing energy," Paul Vosen, president of Degenhardt Home Improvement, told MarketWatch.
The only mid-priced home improvement projects that recouped more cash at resale than window replacements were an entry door replacement, a deck addition, converting an attic into a bedroom and a minor kitchen remodel, according to Remodeling Magazine.
Homeowners that can't afford to tackle a window renovation project should look into a home equity line of credit. This line of credit is given to borrowers who put their homes up as collateral. Homeowners can then use the money lent for renovations, a down payment on a car or student loan repayment.
Seeing the value in windows
Chicago-area real estate agent John Kmiecik understands the investment potential in new windows. Kmiecik recently spent $18,000 on windows for his 3,000-square-foot home in the suburbs of Chicago. Kmiecik told MarketWatch he decided to go ahead with the high-end window replacement project because many homebuyers see new windows as a major plus.
"We are probably going to stay in the house about five to seven years, and, when we do sell, we'll be able to market that property with newer windows," Kmiecik said.
Kmiecik said he has even seen some potential buyers stray away from a home purchase because the windows were shoddy and needed replacing. He said another tipping point comes from windows adding curb appeal, which is always crucial with homebuyers.
Calculating the value of energy savings
Some homeowners want to go all out with pricey window renovations because they figure they'll make up the costs through energy savings. While new windows can offer a home better energy efficiency, choosing to tackle a high-end window replacement project for this reason alone isn't necessarily the best idea.
Although high-efficiency windows provide double the insulation value as older single-pane units, Time Magazine reported homeowners won't necessarily see twice the energy savings.
Paul Scheckel, a home energy efficiency consultant, said a home only loses about 30 percent of its heating and air conditioning through its windows. That means a new window renovation could net a homeowner around 15 percent in energy savings.
So even if a homeowner pays $1,000 a year on heating and cooling costs, they'd only save about $150 per year on annual energy savings. That's why it's important to remember that new windows - along with their energy efficiency - provide solid resale value.
MarketWatch reported there aren't any energy-efficiency tax credits for window replacements at a federal level, but some homeowners might qualify for state or local tax breaks, which further add to the value of this home improvement project.
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