You want to update your 1970s-era kitchen. You're considering adding an office to your home. Or maybe you want to turn that tiny second-floor bathroom into a master bathroom complete with a whirlpool tub. Before you take on any home-improvement project, you should study which ones will boost your home's resale value. Not all home-improvement projects are equal in the eyes of appraisers. And not all will add to your home's appraised value equally.
Curb appeal helps boost the value of a home. This makes sense: Many would-be buyers won't even step into a home if its exterior paint is peeling or its aluminum siding is covered with green mold. That's why the National Association of Realtors lists new aluminum siding as one of the home improvements most likely to boost a residence's appraised value. Appraisers look for improvements that will make a home more attractive -- and valuable to potential buyers. Gleaming new siding fits that category.
Home buyers today focus on bathrooms. They want modern, spacious bathrooms that feature large tubs, soaking showers and other amenities. This is why the National Association of the Remodeling Industry says that a bathroom renovation that costs $13,000 can boost a home's sales price by $11,000. That's a return on investment of 85 percent, good for a home-improvement project. Appraisers will take note of bathroom renovations both for this return on investment and because new bathrooms make it easier for owners to sell a home.
Buyers also want new kitchens. But major kitchen renovations are costly, and might not bring enough value back for the money that homeowners invest in them, according to the 2013 Cost vs. Value Report from Remodeling Magazine. But a minor kitchen remodel -- such as adding new fronts to cabinets; replacing older stoves and cook tops with more efficient versions; replacing old counter tops with granite versions; and installing new mid-priced sinks and faucets -- can bring a strong return on investment, according to Remodeling Magazine. An $18,527 kitchen renovation can add $13,977 to a home's sales price, a return on investment of 75.4 percent, according to Remodeling Magazine.
Sometimes smaller investments can boost the appraised value of a home. According to the 2013 Cost vs. Value report, two such low-cost projects including replacing an old garage door and replacing a home's front door. Remodeling Magazine says that a garage door replacement costing $1,496 will boost a home's value by $1,132, a return on investment of 75.7 percent. The magazine says that a steel entry-door replacement costing $1,137 will add $974 to a home's value, good for a return on investment of 85.6 percent.
Don Rafner has been writing professionally since 1992, with work published in "The Washington Post," "Chicago Tribune," "Phoenix Magazine" and several trade magazines. He is also the managing editor of "Midwest Real Estate News." He specializes in writing about mortgage lending, personal finance, business and real-estate topics. He holds a Bachelor of Arts in journalism from the University of Illinois.