Will or Won't This Upgrade Add Value to My Home?
If there is one question I've been asked at least once a week during my sixteen years as a Realtor, it's this one: "Lucinda, if I upgrade (insert upgrade of your choice), how much will it increase the value of my home?" Homeowners are often a bit disappointed when I explain that $50,000 spent on a kitchen remodel doesn't automatically add $50,000 to the value of their home. If you think about it, it makes sense - assuming the home has an existing kitchen, even it's tired and outdated, it has some existing value. A $50,000 kitchen remodel will certainly add value to your home, but more in the range of $40,500 - $44,000, or 81% - 88% of the cost.
Let's take a look at the return on investment for other common home upgrades. According to Realtor Magazine, here are nationwide average costs recouped for improvements made:
- Minor kitchen remodel (88%)
- Bathroom remodel (85%)
- Major kitchen remodel (81%)
- Family room addition (80%)
- Deck addition (77%)
- Master suite (75%)
- Attic bedroom (74%)
- Siding replacement (73%)
- Window replacement (69%)
- Home office (55%)
What's the right thing to do? That answer varies depending on your budget, your personal needs and how long you plan to remain in your current home, but here are my general rules of thumb:
1. If you plan to stay in your home for less than seven years, consider making upgrades that will appeal to your future buyers - invest in your kitchen and bathrooms and stick with upgrades that will appeal to the masses.
2. If you plan to remain in your home for more than seven years, cosmetic upgrades (replacing cabinets, counter tops, light fixtures, carpet, bathroom vanity, etc.) should be done for your own enjoyment. By the time you sell your home, these upgrades will no longer be "new" and will no longer add significant value to your home. Alternatively, major upgrades, like the addition of a deck, upgrading electrical and plumbing systems, floor plan reconfiguration or the addition of square footage will increase the value of your home long term.
Every home and every situation present a unique set of circumstances, so let's talk it through. I'm here to help you arrive at a decision that makes the most sense for you. Whether you're in Almaden, Cambrian, Willow Glen or beyond, I'm never more than a click or call away!
Lucinda Layton, Realtor®