Home Renovations That Will Pay You Back

When it’s time to remodel, many homeowners head to home improvement stores like Lowe’s to buy the supplies they need to complete their home projects. It’s a smart idea, especially since the right projects can put more money back into your pocket.

However, home renovation costs can be substantial: The average bathroom remodel alone costs between $6,000 and $35,000, according to HomeAdvisor. Meanwhile, a kitchen remodel ranges from $4,500 to $50,000.

If you want to choose the best home renovations, here are several that will give you the biggest bang for your buck when the time comes to sell.

Remodel the Kitchen

“If it’s more than 15 years old, upgrading the kitchen floor, cabinetry and appliances to modern standards will net you more money during [the] time of sale,” said Joe Polyak, founder and realtor of Rise Homes in the San Francisco Bay Area.

Many families view the kitchen as the center of the home. So, minor kitchen renovations can drastically increase your property’s value — the Remodeling report showed a 65 percent national recoup on average. This renovation can also increase home enjoyment for the entire family.

If you have an outdoor kitchen that needs to be renovated, consider updating the appliances. For example, Lowe’s offers savings on high-quality appliances.

“Outdoor entertaining and grilling go hand in hand,” said Jule Eller, director of trend and style at Lowe’s. “So bring the heat, and fire up that backyard flavor with a modular grill. You can choose add-ons like a sink, side burners or refrigerator to create a complete outdoor kitchen.”

Still, renovators should take care not to go overboard with kitchen remodel costs. “Upgrading the appliances to a certain level of luxury — KitchenAid versus Bosch, for example — can significantly increase value,” said Polyak. “Be careful, though. You don’t need to put Wolf appliances in a condo in a blue-collar condo complex. That won’t add value.”

Build an Outdoor Deck

“This can be a fairly inexpensive project that can add a lot of value in the eyes of potential homebuyers,” said Polyak. Specific features tend to vary in popularity by geographic location, and the national average cost for this upgrade is about $10,000 for wood and $17,000 for composite materials, according to Remodeling’s report. Of that amount, a homebuyer can hope to recoup about 71% and 65%, respectively.

“In Arizona, people like a nice fire pit with a beautiful outdoor area. In the San Francisco Bay Area, they like a nice deck with landscaping,” he said. “You can hire someone to do the work, but depending on how handy the homeowner, this can definitely be a fairly inexpensive do-it-yourself project.”

Create a Paver Patio

You might also consider adding a paver patio to your home. “Building a paver patio or walkway is a simple way to make your landscape more inviting and define an outdoor living space,” said Eller. “Best of all, you can install the paving stones yourself. You can also integrate landscape lighting to add ambiance and dimension.”

Eller recommends purchasing 10 percent more blocks, pavers or stones than you anticipated. “The excess should account for breakage, the material you need to cut and replacements for future repairs,” she said.

Upgrade Lighting Fixtures

Most fixtures can be purchased for a few hundred dollars or less, but when you’re working with electrical wires, you’ll also want to make sure to bring in a professional. Most homeowners spend about $318 to bring in an electrician, which will increase overall remodeling bills, according to HomeAdvisor. Still, prospective buyers are likely to appreciate the enhanced lighting, making it one of the best home renovations on a budget.

You might also want to upgrade your outdoor patio lighting with string lights, lanterns, candles, outdoor table lamps or floor lamps to bring your patio to life. Or, perhaps you have a deck? You’ll probably want to upgrade those lights as well. The good news: It won’t cost you a lot of money at stores like Lowe’s.

“From setting a festive mood to offering a soft glow after dark, outdoor lighting is a great way to make your outdoors warm and inviting,” said Eller. “Check out these battery-operated LED step lights or these bronze solar LED post lights.”

Replace the Entry Door

Installing a new steel entry door has the largest cost versus resale value, according to Remodeling’s report. It’s about a $1,400 project that’s likely to boost your home’s value by the same amount.

Bold colors can always replace a traditional door like a bright yellow and high-gloss black. To make this change buy some inexpensive door and apply paint to it yourself. There are plenty of affordable door options you can find online.

Install or Repurpose Flooring

“Updated hardwood floors or new carpeting can help sell a home,” said John Bodrozic, co-founder of digital home management tool HomeZada. “But a lot of the determination of whether the project pays for itself depends on how much money people put into the project.”

According to HomeAdvisor, existing carpets can be cleaned for about $174, and the average hardwood refinishing cost is $1.50 to $4 per square foot. Installation of new flooring increases the cost: $1,583 for carpet and $4,397 for wood. However, you can reduce these sums.

“If you have the skill or are willing to learn, you can save labor costs if you can do some of the work yourself,” said Bodrozic. “If you do hire a contractor, make sure you get three to five bids and make it known to the contractors that they are competing for the business. Depending on the marketing conditions and timing of your project, you could save yourself some money.”

Upgrade to Energy-Efficient Features

“I’m noticing a big trend toward energy-efficient appliances, LED lights and tankless water heaters,” said Diana George, a vice president at Century 21 Real Estate Alliance.

“These products save homeowners money and contribute to a smaller carbon footprint.” A tankless water heater can be installed for about $4,200 in a 2,200-square-foot home, and LED converter bulbs can be bought for about $14 per light, said George.

You don’t have to wait until you move to reap the financial benefits that accompany an energy-efficient upgrade. A tankless water heater can cut a homeowner’s water heating bill by about a fifth each year. A switch from incandescent to LED bulbs, meanwhile, can save a homeowner a surprising $300 per year. Energy-efficient upgrades might not be the most exciting of home improvement projects, but they can have an almost immediate impact on a home’s overall bottom line.

Replace Vinyl Siding

It’s not everyone’s idea of a dream renovation project, but new vinyl siding can dramatically enhance a home’s curb appeal, which can make or break a homeowner’s prospects when selling on the open market.

Newer siding can also help curb heating and cooling costs and reduce occurrences of mold, fungus and mildew. New vinyl siding generally costs around $14,000 and will increase a home’s resale value by about $11,000, according to Remodeling.

Remodel a Bathroom

“Bath renovations are always worth the money invested,” said Karen Gray-Plaisted of Design Solutions KGP in Warwick, New York. “If the home has good bones and quality finishes, the home seller will reap most, if not all, of the cost.”

A homebuyer can expect to pay about $18,000 for a mid-range bathroom renovation and recoup about 65 percent, according to Remodeling. However, making smaller changes can also bring big rewards. “The impact a new light fixture can make can take a house from being dated to feeling new,” said Gray-Plaisted. “I find upgrading light fixtures in bathrooms and kitchens to be worth every penny spent.”

In the end, a home renovation choice is about more than just the value you’ll eventually recoup. Consider projects that will keep your home properly maintained, but also that your family will enjoy. A house is more than an investment; it’s also the place where your family will build memories for years to come.

Open the Floor Plan

An open floor plan is one of the more sought-after features for homebuyers today. However, older homes typically have many walls and narrow hallways, said Polyak. The good news is that it can be surprisingly inexpensive to knock down a wall and create a more cohesive space. An interior demolition costs about $3,000 on average, according to HomeAdvisor.

Even load-bearing walls can be removed, preferably by a skilled contractor who can then place a beam in the ceiling for support. Even with the added home renovation costs, this improvement can still add significant value to a home, said Polyak.

Paint the Interior

Most homeowners spend between $996 and $2,721 on home interior paint costs, according to HomeAdvisor. At that price point, it’s easy to recoup the cost when it’s time to sell. Even so, it might be worthwhile to consult a professional before selecting a color.

Still, professional advice doesn’t have to add to the cost of the project. Many national paint retailers like Sherwin-Williams and Benjamin Moore offer free paint consultations.

 

 

 

 

How Much Value Does a Kitchen Remodel Add to Your Home?

So you’re trying to decide if you should put a new kitchen in your home. The estimates are in, and they’re all far higher than you expected. You may be having doubts and wondering if you should really go ahead with the project. Is a brand-new kitchen really worth the cost?

If you’re smart, you’ll think long-term. The money you spend on your kitchen now could pay you back handily when you put your home on the market. So, how much does a kitchen remodel increase home value? The answer may help you decide if you really want to go through with the project.

How Much Does a Kitchen Remodel Increase Home Value?

A new kitchen can increase home value. In general, the value is expressed as the percentage of money spent on the remodel the homeowner recovers after the sale of the home. Better Homes and Gardens says homeowners can expect a return of about 52% on their investment in a new kitchen if they sell their home. The exact amount you’ll recoup depends on a few factors, such as your house value, the value of houses in your neighborhood and the quality of the project.

How much your home value increases is also dependent on how much you spend on the project. According to Moving.com, a major upscale kitchen remodel returns 53.9% of the money invested. Remodeling your kitchen with mid-range fixtures has a 58.6% return on investment. If you do a minor kitchen upgrade with mid-range fixtures, you’ll see a 77.6% ROI.

It may seem counterintuitive that a minor kitchen renovation, such as replacing cabinets, offers a higher ROI than a major renovation, such as changing the structure and layout of your kitchen. You would think that the more money you invest, the more you’ll get back. But, if you take into account that you are spending far less money on a minor renovation while still getting the desired result, it makes sense that the return is higher.

Looking only at the numbers does not show you the full return value. Think about how long you intend to live in the house after you remodel the kitchen. If you plan on moving quickly after the remodel, the percentage of return is the biggest factor. But if you plan on staying in the home for a number of years after the remodel, you should make upgrades that make sense for your family.

What Percentage of Your House Value Should You Spend on a Kitchen?

Experts suggest that homeowners should spend 6 to 10% of the home’s value on a kitchen renovation. Spending more than that might not give you a good return on your investment. You have to analyze the money you’re spending compared to the potential value you are adding.

For example, if your house is worth $500,000 and you spend $100,000 (20%) of the home’s value on a major kitchen renovation, you’ll get see about a 53.9% ROI — or a $53,900 boost to your home’s value.

In contrast, if you spend $50,000 (10%) of your home’s value on a smaller-scale kitchen upgrade, you can expect an ROI of 77.6% — or a $38,800 home value increase.

In the first example, minus the boost to home value, you’ve spent almost $50,000 on a new kitchen. But in the second, you’re only out about $11,000. Don’t just jump into a major renovation thinking it will give you the best return; often, the opposite is true.

Also, take into account the time you plan to spend in your home after the kitchen is remodeled. If you are moving right away, the 6-to-10% rule makes sense. However, if you plan to stay in your home for years to come, you might want to spend more because the investment also becomes about your personal enjoyment of the space.

Does a Kitchen Add Value to a House?

A new kitchen does add value to a house. It’s one of the most popular rooms in the house, and it’s the room where you and your family spend the most time. It’s no wonder kitchens are one of the first rooms that homeowners look at when they’re considering renovating their homes. It’s so popular that real estate experts have listed kitchen upgrades and full kitchen renovations as second and third in a list of home renovations that add value to your home.

But homeowners should consider more than just money when judging the value of their house. There’s also something called the joy score, which measures the satisfaction a homeowner gets from living in a pleasing and functional space. The National Association of Realtors lists a kitchen renovation as having a joy score of 10 out of 10, no matter if the work was done by a professional or by the homeowner.

With this in mind, you can’t judge your home in terms of money only. So, before you start adding up the monetary value a kitchen adds to your home, be sure to consider the emotional and aesthetic value as well.

Will the construction industry be able to keep up with the home remodeling boom?

With all of last year’s turmoil, few people expected the home remodeling industry to grow almost 6% from the previous year.

2019 was a banner year in itself with $383 billion in construction, and 2020 is anticipated to reach $405 billion.

Four factors have spurred the growth:

  1. Accelerated new home prices
  2. Low inventory of for-sale existing homes
  3. Wide spread desire to get out of urban areas
  4. Low interest rates by the Fed

The spring 2020 economic uncertainty led to consumers of all ages and demographics desiring home renovations.

At the same time, one demographic factor is the transition of boomers and older homeowners out of their existing residence into smaller accommodations.

Potentially 11 million homeowners will be moving on or out, while 15 million younger households will be scratching for homes.

Interestingly, younger home buyers, given the choice of a condominium or an existing fixer-upper, are more apt to pursue the latter and plunge into remodeling.

Up to 40% of the kitchen and bath renovations are done by millennials and Gen-Xers. This is not news to most real estate agents today. With the current high cost of obtaining the tarnished American dream of new home ownership, young buyers are kicking the tires, or aluminum siding, for shelter.

According to the Harvard Research’s analysis of the leading indicator of remodeling activity, or LIRA, expect slower growth in 2021 but 2% quarter-over-quarter increases.

The remodeling industry had doubled in 10 years. While new home sales are strong, they are still outside the reach of many younger households

Naturally, every region is different.

The North Bay has had an enormous amount of fire replacement and earthquake repairs that are still happening. Small repairs and basic one item improvements, such as new flooring, takes a different track than larger projects requiring multiple technicians and skills. Whenever multi-tasked renovations occur, the time lines and the construction costs escalate.

At the same time, construction materials prices have exploded, and the supply lines are faltering.

Lumber has exploded 55%–63% in some areas. The timelines for construction have telescoped 20%: A project that should have taken four months is taking five months or longer.

What the market is still anxiously looking for is if COVID-19 will permanently affect our spending habits.

An important milestone in determining if a remodeling is needed is the age of the last renovation. As a general rule, 16-20 years is the life expectancy of a remodel.

As the finishes and sustainability disappears, the desire to catch up with the latest looks, materials and finishes start to wear through. The appetite to renovate one’s home is greater among younger households who are more media savvy and aware of latest trends.

One of the biggest challenges will be finding professional contractors and subcontractors.

Many small contractors have fallen on hard times and are not coming back. The Paycheck Protection Program from the CARES ACT helped 83,036 remodelers and subcontractors with their payroll obligations, but there’s no assurance that they will be back.

It becomes an open question on how many remodelers and professionals will be able to survive into 2021 with the continuing market uncertainties that include longer construction times and disrupted supply chains.

It would appear that the smaller contractors and professionals will be leaving while only long-term well-capitalized businesses with a steady source of skilled labor will survive.

Construction and renovation have been the first industrial sectors to emerge in every economic downturn or recession since World War ll.

Small builders and contractors represent the vast majority of America’s home building and remodeling industries, not big corporations. These are the businesses that will generate the jobs and raise the overall living standards in this country.

Not the government, not the unions and certainly not the retail business importing cheap goods to sell out of big box stores or deliver to your door. The home building and renovation industry is the main engine that will take the US out of this economic quagmire.

So, tell me this: Why are kitchens getting humongous and people cooking less? Why have a huge kitchen island to eat your DoorDash delivery?

What to know about renovating your kitchen during covid

I know I’m not the only one more than a year into this pandemic who is looking around their kitchen and thinking the space needs a little TLC and perhaps some revamping. Although my situation is different from most people’s — I’ve started a little baking business, so the toll on my countertops, painted cabinets and tile floor has been massive — I think the current appetite to improve the appearance and function of this much-used room is shared by many.

Unfortunately, a kitchen renovation means two things: You need to be prepared to spend some serious cash, and you need to be patient; the wait lists for contractor availability and access to raw materials and appliances are longer than ever.

When it comes to the first scary point — the budget — Eric Shipe, owner of Bath Plus Kitchen, a kitchen and bath remodeling company based in Alexandria, Va., says to prepare yourself for sticker shock, primarily because of the current high cost of lumber and building materials. Expect to spend $65,000 to $90,000 “if you’re replacing all materials in a 200-square-foot kitchen, L-shape with an island,” he says. A luxury kitchen will range from $110,000 to $150,000 or higher.

Claire Staszak, principal designer and owner of Centered by Design, a Chicago-based design firm with a specialization in kitchen design, says that depending on where you live and your kitchen’s size, “the average renovation with high-end appliances and semi-custom cabinets” starts at $100,000. Of that budget, both Shipe and Staszak say the bulk of it — about 40 percent — will go toward cabinets, with appliances as the second-biggest line item.

If these estimates are out of your price range, Shipe says, think about taking out a loan for your project. “Even if you have the cash, with rates so low, why not consider financing?” He continues: “The number one regret is not spending enough to get what you want. Unfortunately, most people don’t realize they can finance until after they’ve spent tens of thousands on a kitchen remodel.” His advice: If you want a kitchen you’ll love and one that will last, spend the money to get you there.

As for hiring the right people, Staszak says, vet everyone with referrals, and see their work in person, either in a showroom or a former client’s home. “The execution of your project is what is most important,” she says, “so invest in the best contractor, designer, cabinet company, etcetera, that you can or feel comfortable with.” And Shipe cautions against using anyone who is too eager. “Demand is at an all-time high,” he says. “By the time a crew is available to start your project, materials should be, too. If someone is telling you they can start your kitchen remodel in the next one to three weeks, that’s a red flag.”

When it comes to selecting the nuts and bolts of a kitchen remodel, both Shipe and Staszak shared some of their top recommendations.

Countertops: Both like quartzite, because it’s a natural stone with the look of high-end marble, but it has the durability and heat and stain resistance of granite. Shipe also says to consider either quartz or Dekton because of their practicality; both are manufactured, rather than naturally occurring, and require little care. If you end up choosing a natural stone, Staszak says, make sure you see a full slab, not just a small sample, because the scale of the pattern or veining can vary.

Flooring: Both experts say that wide-plank white oak is the choice du jour. Staszak says it takes a variety of stains well. But Shipe cautions that because of its high demand, prices have gone up. He suggests considering luxury vinyl planks, because they’re waterproof and half the price.

Appliances: Shipe likes the matte white models from GE’s Café brand, but he also uses luxury brands, such as Sub-Zero, Wolf and Viking. Staszak leans toward Thermador, GE’s Monogram and Sub-Zero. For lower-priced models, she recommends Samsung for refrigeration and Bosch for dishwashers, as well as the Café line.

Because appliances play such a big role in the design process, Staszak tries to have clients commit to models before she begins drawing up the kitchen. The clients’ ultimate choices are those that meet their cooking, space and installation needs. Whatever you end up selecting, Staszak says, ensure your cabinetmaker has all of your appliance choices and measurements before cabinet production.

Cabinetry: Shipe says to consider more affordable laminate cabinets, especially given long lead times for painted and stained cabinetry. “Laminate cabinet technology has come a long way,” he notes, “and many include features such as anti-fingerprint and antimicrobial.” Shipe also recommends frameless cabinetry, which can give you 5 to 10 percent more storage space. And he says to think twice before installing trendy floating shelves. “They are a commitment. Your challenges are dust and organization,” he says. “We recommend not cramming too much onto floating shelves. If you’re using them for everyday items, such as plates, bowls or cups, it may end up looking too cluttered.”

It’s not surprising that both Shipe and Staszak emphasize the importance of working with a skilled kitchen designer or architect to lay out your cabinets, because a large portion of your budget goes to their fabrication. Staszak sees a lot of awkward cabinet designs that don’t seem well-planned, useful or beautiful. “Good cabinet design comes down to tiny quarter-inch details,” she says.

Layout: A skilled designer will help you think about how the space meets your needs. Take, for example, the case of an island design. Before beginning, Shipe would ask his clients if, when hosting, they want a large, open island where everyone can sit and be part of the action, or an island that hides the kitchen mess but provides great storage. Depending on the answer, he provides a design in which the island top is all one level, so the kitchen is open and inviting, or has a raised bar and a tall storage area to hide the kitchen mess. A designer should listen to your needs and be able to translate them to the design.

Trends: Lastly, both Shipe and Staszak are cautious of kitchen trends. Although they realize that Pinterest and Instagram are great resources for gathering ideas, picking a timeless design, especially when making such a big investment, is more prudent. Staszak says that if you want a trendy note in your kitchen, then focus on lighting and hardware; they are the easiest to swap out and experiment with. And whatever you do, Staszak says, gather samples of all your materials, look at them together before you order and pick your paint color last.

Mayhew, a “Today” show style expert and former magazine editor, is the author of “Flip! for Decorating.”

Backyard kitchen trends provide budget-friendly options

You might think a decked-out backyard kitchen in Pennsylvania defies logic, but thanks to new technological advancements, year-round patio dinner parties are now well within reach — no matter the climate where you live.

“It used to be just the purview of the Sun Belt, but it has spread because of the improvement of materials and design of the components,” says Russ Faulk, chief designer and head of product for Kalamazoo Outdoor Gourmet, an outdoor kitchen equipment manufacturer based in Chicago and Galesburg, Mich. “In a very high-end home, you might have radiant heating under the bathroom floor, and people will do that for their countertop. Flip a switch, melt the snow and use the outdoor kitchen.”

Of course, someone willing to install a counter-warming snow-buster would be on the “pointy end of the budget stick,” as Faulk puts it. The reality is that not everyone can afford all the bells and whistles, such as a cocktail station, a countertop fire feature, custom granite or a grill burner for cooking sauces.

Go for the grill

David Bond, president of Florida-based U.S. Brick & Block Systems, which installs pavers, pools, outdoor kitchens and more, says the grill is the cornerstone for your budget. To stay within your price range, you might have to pass on luxuries, such as a sear zone, a griddle or infrared rotisserie. “That can bring the cost down,” he says, adding that size is less important than quality. “It’s always best to get a good grill brand than to have a big grill that’s not going to last.”

Faulk, who also authored the recently released cookbook Food + Fire: Cooking Outside with Kalamazoo Outdoor Grillmaster Russ Faulk, agrees that the grill is the most important feature of any outdoor ooking space.

“Where I tell people not to scrimp is the grill, especially if it’s being built into masonry,” he says. “If you hate your grill, you’re probably not going to love your outdoor kitchen. And they’re tough to swap out because they don’t come in standardized sizes.”

Faulk adds that opting for movable components like tables and countertops rather than large stone kitchens with built-in grills is an increasing trend, somewhat driven by budget-minded homeowners who like the idea of growing their outdoor kitchens gradually.

“Instead of making your design decisions permanent and literally set in stone, there are a lot of other options to change and evolve your kitchen over time.”

Exceptional extras

When it comes to design, the next thing to consider with built-in kitchen spaces is what type of accent  materials you’re interested in for countertops and cabinets, which often feature some type of masonry. “Typically, the thing with the most impact is the type of stone used on the cabinet,” says Bond. “Most everything else is just stainless steel appliances, so your stone and countertop will make the most difference.”

Despite efforts to rein in the spending, the urge to splurge on alfresco cooking and dining isn’t going anywhere.

“People are using the outdoor of their homes more than ever,” says Bond. “There are certainly instances of people spending more time and money on their outdoor kitchens than they are on their indoor kitchen.”

For those who really want to go all out, popular add-ons include entertainment zones like bars, dedicated cleanup areas and specialty refrigeration like wine coolers, freezers and under-counter refrigerator drawers to keep meat and produce separate. Faulk says smokers and wood-fired grills are especially hot right now, following the cooking trends popping up in restaurants across the country.

“What’s great about the outdoor kitchen, especially how it relates to the enthusiast, is it’s really difficult to implement this specialty equipment in an inside kitchen,” he says of restaurant trends influencing home trends.

He points to the rise in home pizza ovens after chefs across America fell in love with Neapolitan pies.

“You have to be cooking those pizzas at 800 degrees, and that was really hard to implement in your home, so it went outdoors, naturally,” says Faulk, who adds that he expects Argentinian-style grills, which are equipped with an adjustable height and a sloped V-shaped grate surface to allow more precise temperature control and uniform cooking, to gain in popularity this year.

Perhaps the best splurges, however, are those that make your outdoor kitchen available whenever the mood strikes, such as weather-proof cabinetry so you can keep everything you need stocked and handy — or maybe even that fancy countertop warmer.

“If you feel like you have to spend three to four hours to get your outdoor kitchen ready just to use it, you’re not going to be excited about using it,” says Faulk. “It should be always ready to go, always easy.”