Whether you're renovating so you can sell your home for top dollar in the future or are flipping a house for a near-term profit, it's important to identify the home renovations with the best return on investment. The following home improvement projects run the gamut from moderately expensive to very costly, but according to Remodeling Magazine's annual Cost vs. Value report, here's where it pays to put your money.
1. Garage door replacement
Anyone with an older garage knows all too well that older doors can stick, jam, or just plain look banged-up and unsightly. The average garage door replacement job costs $3,611, and the average cost recouped for that project is $3,520, representing 97.5% of that initial investment. That's a pretty good deal.
While you can replace a garage door yourself, you may be better off hiring a contractor, especially if you're not experienced with that sort of task. Because garage doors are heavy, cumbersome, and tension-loaded, the risk of injury is somewhat high if you're installing one solo.
2. Manufactured stone veneer
The nicer your home's exterior, the more curb appeal it will have, and that's something potential buyers are apt to notice and appreciate. The average cost to install manufactured stone veneer (which is fake stone that’s made to look like the real thing -- more expensive natural stone) is $8,907, though your home's size will play a big role in determining your total expense. The average amount recouped for this project, meanwhile, is $8,449, representing 94.9% of your initial investment. Generally, this sort of project is something you’ll need a contractor for unless you’re experienced in doing it yourself.
3. Minor kitchen remodels
One of the most important home improvement projects you can make is updating your kitchen. Many buyers consider the kitchen the heart of the home, and sinking money into new countertops, nice-looking cabinetry, and energy-efficient appliances could spell the difference between commanding top dollar for your home when it's time to sell or getting less money for it.
The average cost of a mid-range kitchen remodel is $22,507, of which you'll recoup $18,123, or 80.5%. If you're flipping a house, it definitely pays to focus on updating its kitchen, and if you're renovating a home you still plan to live in, a kitchen overhaul could not only be a great return on investment, but be a source of enjoyment for you for years.
Keep in mind that you may be able to tackle certain components of a kitchen remodel yourself. For example, if you’re refacing cabinets rather than replacing them, that’s work you can do somewhat easily. The same holds true for installing new cabinet hardware. But when it comes to hauling and hooking up appliances or replacing countertops, you may want to hire a professional.
4. Wooden decks
Outdoor living tends to be important to buyers, which is why a wooden deck addition is something worth considering for your home or a home you’re flipping. The average cost of putting one on is $13,333, while the average recoup is $10,083, representing 75.6% of the cost.
That said, wooden decks are harder to maintain than decks made of composite material, and while they're cheaper to install, you'll need to weigh those savings against the potential work involved if you're doing home renovations on a property you still intend to live in. If you're flipping a home, consider that a composite deck could be a selling point to buyers who don't want a maintenance-heavy property.
Keep in mind that composite decks have a lower recoup value, percentage-wise, than wooden decks. The average cost to install one is $19,150, with a recoup percentage of 69.1% -- still a decent return on investment, but not as high as that of wooden decks.
Installing a deck is something you can do yourself if you’re handy, but an elevated deck may be a job best left for professionals. And remember, there are always weather-related constraints to contend with when dealing with outdoor projects, so keep that in mind when making your decision.
5. Siding replacement
Earlier, we talked about the importance of curb appeal. If your home's siding is damaged and worn, replacing it could be a smart financial move. The average cost to do so is $16,036, of which you'll recoup $12,119, on average, representing 75.6% of your initial outlay. Though it’s possible to replace siding yourself, it can be a time- and labor-intensive job, so you may want to consider outsourcing it.
Make the most of your money
Whether you're renovating a home you'd like to continue living in or are fixing up a home to sell quickly, it's important to understand which updates offer the best return on investment. As such, the above upgrades may be the best way to spend your money if your goal is to command top dollar for that property, whether immediately or in the future.
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