Wondering if there are any tangible benefits of home renovations—other than the emotional payoff of feeling like you’re living in a brand new place, despite that it may be decades old in reality? If so, you’re not alone. The National Association of Realtor’s Home Buyer and Seller Generational Trends Report 2015 revealed that more than half of home buyers who ages 34 and younger buy a new home, simply because they don’t want to deal with the headaches that home renovations can entail.
But the reality of high-demand, low inventory real estate markets sometimes means you’ll fare better financially by updating your current home, or buying one that needs some minor renovations, rather than holding out for your proverbial dream home.
Here’s a look at how to choose the home renovation projects that will give you the most bang for your buck, in terms of upfront cost and potential return on investment (ROI).
1. Your Entryway Door(s)
Your front door may not be at top of your home renovations list, but according to Remodeling Magazine’s 2014-2015 annual cost vs value report replacing it with a steel one can deliver more than a 100% ROI. In addition to curb appeal and making a great first impression on your guests (and potential buyers when you decide to sell), steel front doors add to the energy efficiency and security of your home, and can be customized to match your home’s exterior color scheme. Though prices vary based on the style of door, expect to pay about $1,300 for this small but mighty update.
2. Your Home’s Exterior
Though the current style and geographic location of your home will determine which exterior improvements deliver the most bang for your buck to some extent, Remodeling Magazine’s data shows that adding manufactured stone veneer to accent traditional siding (made of wood, vinyl, stucco or aluminum) can deliver a nearly 90% ROI. Though you’ll need to waterproof the area between the stone veneer (which is made to look like natural rocks) and the home’s siding, this renovation element can give your home a higher end look, for about $7,000. If stone isn’t your style, replacing the exterior of your home with vinyl siding is another investment that will deliver about an 80% ROI when you’re ready to sell.
3. Your Outdoor Living Space
Adding to the square footage of your home’s interior can be a daunting exercise in obtaining city permits and architectural plans, managing contractors and budgets, and of course, living amongst plenty of noise and dust.
But adding a wooden deck to your outdoor space can deliver one of the biggest benefits of home renovation: It costs less than $30 per square feet, you’ll have a private haven you can use to entertain, relax, and enjoy the outdoors—and when you go to sell, Remodeling Magazine estimates that you’ll recoup about 80% of your investment.
4. New Windows
Old, drafty windows lead to higher than necessary heating and cooling bills, reduced security, and the potential for bugs and animals to enter your home. Plus, the NAR’s data indicates that home buyers across all age groups consider a home’s heating and cooling costs as a top priority when deciding where they’ll live.
Though replacing wooden windows in older homes can cost between $10,000 to $20,000+ based on the age of your home, and size and number of windows, you’ll get about 78% of your money back in the form of added value (not including lower heating and cooling bills). Vinyl replacement windows tend to come with a much lower price tag—but similar ROI.
5. Attic Additions
The majority of home shoppers buy homes with at least two full bathrooms, and three or more bedrooms, according to NAR’s data. If your home could use one or both of these additional features, consider renovating your attic. Because your attic space uses the existing footprint of your home, it can be a more seamless (and less pricey) renovation than building a new addition. Though the project could cost about $50,000 and the remodel ROI has dropped slightly since 2014 (to about 77%), these additional living spaces still tend to payoff better than pricier renovation alternatives like basement, family room, garage, office and sunroom additions and remodels.
6. Minor Kitchen Remodels
You don’t have to renovate your entire kitchen to upgrade the space. In fact, Remodeling Magazine’s report says that for about $20,000 you’ll see a an ROI of nearly 80% simply by installing “minor remodel” features like new cabinet doors and pulls, appliances, countertops and floors. By contrast, a complete kitchen makeover could cost about $56,000—and you’ll only recoup 68% of the investment.