Whether you intend to flip a property or keep it for personal use, you will need to consider the return you are getting not just on the money spent on the house but, more importantly, the cash you put into upgrading several features of the property.
In the US, kitchen remodels and steps to improve curb appeal offer the highest ROI. The industry as a whole is worth over $400 billion and the average cost recovery rate is 56%. However, there are projects including a repaint of the interior, major bathroom renovations, and installation of smart devices that can also offer triple-digit ROI.
These trends are more or less similar throughout the country. For instance, in Jacksonville, Florida, new cabinetry and plumbing are the most valuable home features. They are followed by the addition of large windows to allow more natural light. As for the most popular upgrades, a pool, master bedroom, washer, and soaker tub are ranked the highest.
That being said, here are the home upgrades with the highest ROI:
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Bathroom remodels
There is no doubt about the fact there are only two rooms that sell houses, the bathroom and the kitchen. However, regarding actual ROI, a bathroom renovation trumps kitchen upgrades. The estimated returns for these upgrades are 102%. With the help of a professional bath remodeler in Jacksonville, FL, you can explore a wide variety of options for the space.
Even minor renovations like replacing the fixtures, installing a shower instead of a tub, or adding a rain shower can make significant differences. They can also add considerably to the final list price of the home because people are willing to pay more for all these amenities. Not to mention, minor renovations are not very expensive either.
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Kitchen redesign
The term “midrange” refers to a kitchen upgrade that is only moderately sophisticated because premium supplies and appliances are out of your price range. Refacing the cabinets, installing new surfaces such as countertops, adding fresh taps or other hardware, changing the flooring material, and equipment that is not the most sophisticated but is an improvement over what was already installed are all part of this process. A modest kitchen remodel such as this can provide an 86% cost recovery for the typical homeowner.
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Installing more sophisticated HVAC systems
People are more likely to buy and live in homes with maybe some technological characteristics now that home technology has advanced. HVAC technology is first on this list. These devices maintain the ideal temperature throughout the home at all times and significantly reduce energy use and utility costs, especially when the house is empty.
The home improvement project with the highest returns on investment has been shown to be electrifying the HVAC system, which involves replacing the standard heater with an electrical heating mechanism. This modification typically costs around $17,750, but at the selling stage, it can add up to nearly $18,400, yielding a 103% gain on the investment.
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Garage door replacement
Changing the garage door is one of the most cost-effective but extremely beneficial improvement projects. Depending on the style of door you choose, the specific costs of replacement can vary, but on average, the process can cost you roughly $4,300. However, the return is exactly 103% for HVAC upgrades.
This means that assuming you ultimately choose to sell the home, you can anticipate that this upgrade will raise the overall price of the listing by about $4,400. The contemporary and useful door is yours to keep for as long as you aren’t selling. A new garage door not only enhances the appearance of the home’s exterior but also creates a welcoming atmosphere within.
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Replacing the main door
As strange as it may sound, changing your front door with a steel one will also add to your home’s value. The return comes in at 101%.
According to market research, the total cost of replacing a door, including labor, materials, and any other costs related to overhead, can reach $2,214. Additionally, this modification can provide a typical payback of $2,235 on the home’s price in the present market. Obviously, based on the duration that you own or occupy the property, this figure may increase or decrease.
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The siding of stone veneers for the exterior
Installing stone veneers as an alternative to your home’s current exterior siding might provide an anticipated profit of 102% on the money you spend. This synthetic material, often known as faux stone, imitates the organic appearance and texture of stone without the disadvantages of being overly heavy and infested with mold.
The cost of applying stone veneers to the exterior of a typical home is $10,925. When the stage where you want to sell arrives, the upgrade is worth a total of $11,177. Of course, the costs might vary based on the state of the market, where you reside, the choice of material, and the contractor you choose, to name a few.
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Fiber-cement and vinyl siding are also a great option
Even though you won’t make enough money from the improvements to pay for them when you finally put the house on the market, they are still worthwhile initiatives that can significantly increase the property’s value. For instance, the typical homeowner can anticipate a 95% return on a vinyl siding replacement while only getting an 89% return on a fiber-cement siding replacement.
Conclusion
Only a small number of home renovation projects provide a cost return rate of 100% or more. The aforementioned prices and rates of return, while they do provide an overview and can change due to a wide range of factors, are, in fact, not fixed in stone. In order to determine the potential returns in the real estate market where your home is located, it is best to speak with a trustworthy local contractor. However, in almost every area, these and similar upgrades offer significant benefits in terms of costs.