According to the 2010-2011 Remodeling magazine Cost vs. Value Report, these updates bring the best return based on their cost and the value they add to your home. So, counting down from #10 to #1, the best Return on Investment, here is the list.
#10: Two-Story Addition
Return on Investment: 65 percent. A two-story addition can be a painfully expensive remodeling project. The payback is just 65 percent, and the amount of cash you’ll use is stupendously high: $165,243 on average. On the bright side, if you plan to add a master suite addition ($108,090) plus a family room addition ($85,740), combining the two into a two-story addition looks like a relative bargain. If you decide to go for this project, be careful not to improve your home beyond the size and finish of the other homes on your block, or you’ll end up with an even lower remodeling return.
#9: Major Kitchen Remodel
Return on Investment: 68.7 percent. If your kitchen remodeling plans call for stripping the room to the studs and starting over, you’ll spend an average of about $58,000 for semi-custom cabinets, an island, mid-range appliances, laminate countertops, resilient flooring and custom lighting. Expect to see about 68.7 percent or about $40,000 come back at resale. If your neighborhood runs more toward granite countertops and commercial-grade appliances (the upscale version of the major kitchen remodel), you’ll spend around $113,000 and can expect a smaller return: 59.7 percent.
#8: Basement Remodel
Return on Investment: 70 percent. Coming in at an average cost of about $65,000, remodeling an unfinished basement to add a 20 x 30-foot gathering space, a 5 x 8-foot bath and a 10-foot wet bar creates a man cave that’s also great for kids’ sleepovers, book club meetings and visits from the grandparents. As long as you stay put until the kids leave for college, it won’t matter that you’ll lose nearly $20,000 of your remodeling costs if you have to resell your home right away.
#7: Attic Remodeling That Adds a Bedroom
Return on Investment: 72.2 percent. An attic remodel that converts an unused attic into a bedroom and adds a bathroom with a shower will cost an average of $51,428. That’s not cheap, but it’s still half the cost of creating a master suite addition from the ground up and you won’t lose any yard to this project.
#6: Window Replacement
Return on Investment: 67.5 percent to 72.6 percent. Returns for different types of windows range from a low of 67.5 percent for upscale wood windows to a high 72.6 percent for upscale vinyl windows. Choosing between vinyl and wood? Go with whichever is most popular on your street. The energy-savings payback on new windows isn’t as clear, unless you’re swapping old, single-pane windows for energy efficient multi-pane windows. Buy Energy Star windows that are right for your climate to maximize energy savings, then file for the 10 percent federal tax credit (up to $200) to get back some of your remodeling expenses.
#5: Minor Kitchen Remodel
Return on Investment: 72.8 percent. The trick to getting a solid kitchen remodel return is to restrain yourself. Walk away from the granite countertop (unless you can find inexpensive remnants) and the custom cabinets. With a budget of around $22,000, you can reface cabinets, add a new laminate countertop, sink and faucet, and still have enough money to lay a resilient floor.
#4: Build a Wood Deck
Return on Investment: 72.8 percent. A small 16 x 20-foot wood deck with a bench, planter and a few steps down to the yard creates a natural transition from indoor to outdoor spaces at an average cost of about $11,000. A longer-lasting composite deck will run you closer to $38,000, and it has a much smaller expected return: 57.7 percent. It’s hard to get homebuyers to pay up for something they’re not going to have to do (like sealing a deck).
#3: Fiber-Cement Siding
Return on Investment: 80 percent. Adding new siding is like buying a new coat for your house, and fiber-cement siding is the chic choice, especially if you live in an upscale neighborhood. When choosing siding, do as the neighbors do. If they’re using vinyl siding, go with vinyl. Foam-backed and non-foam-back vinyl have the same return — 72.4 percent — but the foam-backed costs average $14,000, compared to $11,000 for plain vinyl.
#2: New Garage Door
Return on Investment: 83.9 percent. If your garage door faces the street, replacing it improves a big portion of the front view of your home for a small price tag. Be sure to match the new garage door to the style of your home. For about $1,300, you can install a four-section garage door with galvanized steel tracks. Reuse the old door-opener motor and save even more.
#1: New Front Door
Return on Investment: 102.1 percent. A new 20-gauge steel front door that’s half glass will cost you $1,218, but will boost your home’s resale value by $1,243, netting a return of 102.1 percent. If you’re swapping out an existing wood door, you’ll find the steel door needs much less maintenance. Buy for looks, not energy efficiency claims, since you’ll lose more heat from cracks around the door frame than through the door itself.
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