Many homeowners often grapple with a common question: “Will I get a return on my investment if I embark on this remodeling project?” My initial response is always the same and it is very honest:
“It depends.” How is that for an answer?
The truth is there are a variety of factors that influence Cost vs. Value discussions. Below we will outline the things we think matter most as you navigate these decisions.
Your Location Matters: The location of your home plays a pivotal role in determining the ROI of a remodeling project. An up-and-coming neighborhood can yield high returns even with minimal investment, while a slightly less popular area might require substantial spending to see a smaller return. Always being aware of what is going on in the neighborhoods around you is important if ROI is important to you. Remember the adage: “Location. Location. Location.”
REAL LIFE: We once did a $75,000 bathroom remodel on a home worth under $280,000. The homeowner had a job change that forced relocation and they had to sell less than a year after completion of this project. Because they lived in a very desirable area, that home sold in 24 hours with 4 offers well over asking price (Pre-Covid Timing) and they got back every dime they invested in this project. Would we have expected that? Nope, but it sure speaks to the power of an attractive remodel and a great location!
Timing is Key: The duration you plan to stay in your home matters too. Take a typical kitchen. If this is your forever home, then we will do whatever makes you happy. You might be in an older neighborhood and have been there 30 years, but if you want walls removed with new cabinets, new quartz countertops and fancy backsplash, then you’re gonna get it!
Take the exact same home and assume for a moment it is your first ever home and you plan to move in 2-3 years. There is less chance we would suggest that you take out walls and select the types of luxury products you might be inclined to choose for your forever home. You simply won’t be there long enough to justify the investment. In those situations, it is often the minimal upgrades to make you happy for the next 2-3 years that win out.
You have to think… reputable remodelers don’t want your relationship for this project. We want your relationship for ALL of your projects over ALL of your years. So, to earn that trust we have to do what is best for you every step of the way.
The Cost vs. Value Study
Every year, a study known as the “Cost vs. Value” study for remodeling projects is released. While it provides valuable insights, it’s essential not to take it as gospel. It’s based on various factors, including labor and material costs, which can vary greatly depending on your location and current market conditions. It is also determined by input from 6,000 realtors across the country and a variety of federally tracked statistics that I think fail to keep up with current economic conditions. Given that understanding, I use the study ONLY as a guide to assess trends.
Key Takeaways from the 2023 Study:
- Projects like garage door and entry door replacements, siding replacements, window replacements, stone veneers, and HVAC upgrades tend to offer the highest ROI.
- Minor and mid-range kitchen and bathroom remodels often provide better returns than major upscale remodels.
- Major additions and upscale remodels may yield lower ROI.
Consider Your Unique Situation
Ultimately, your remodeling decisions should align with your specific circumstances and objectives. If you’re selling soon, minor updates can enhance curb appeal and attract potential buyers. However, for long-term homeowners, investing in major renovations for your enjoyment is a valid choice.
Remember, the “Cost vs. Value” study can offer valuable insights, but it’s crucial to factor in your location, market conditions, and personal preferences when making remodeling decisions.
As always, thank you for reading and we wish you a fantastic week ahead! If you have any questions or want to share your experiences, please connect with us on Facebook. Your feedback and experiences can enrich our discussions and help fellow homeowners make informed choices.
Join us again next week for more insightful discussions on home improvement and remodeling.
Stay Inspired!
Weekly Home Tip:
Ensure Your Family’s Safety By Testing Smoke and Carbon Monoxide Detectors
Your home is your sanctuary and keeping it safe is a top priority. As we transition into the colder months, it’s essential to make sure your smoke and carbon monoxide detectors are in working order. These life-saving devices are your first line of defense against the invisible threats that can lurk in any home.
What You Can Do
- Replace Batteries: Start by replacing the batteries in all of your smoke and carbon monoxide detectors. Use fresh, high-quality batteries to ensure consistent power.
- Test Each Detector: After replacing the batteries, perform a test on each detector. Most detectors have a “test” button that, when pressed, will sound the alarm to confirm that the device is functioning correctly. Make sure you can hear the alarm from all areas of your home.
- Clean and Inspect: While you’re testing, take a moment to clean the detectors and inspect them for any visible damage or signs of wear. Dust and debris can accumulate over time and hinder their performance.
- Replace Outdated Detectors: Detectors typically have a lifespan of 7-10 years. If your detectors are older or have reached their expiration date, consider replacing them with new, up-to-date models.
- Ensure Proper Placement: Make sure your detectors are appropriately placed throughout your home. There should be a detector on each floor, in hallways outside of bedrooms, and within bedrooms themselves.
This week, make safety a top priority by testing and maintaining your smoke and carbon monoxide detectors. It’s a simple task that can have life-saving consequences.