Scott McClurg was recently interviewed on NewsChannel 9's “Bridge Street” about home remodeling projects that provide the best (and worst) return on investment (ROI).
Scott referenced REMODELING Magazine’s "Cost Vs. Value Report 2011-12”, which provides detailed information about the average cost of 35 popular remodeling projects and the amount a homeowner can expect at resale after making the investment in their home.
While the report gives consumers a good idea about project costs, always consider these three questions when planning a remodeling project:
What do I gain by remodeling? Many people remodel to enrich their lifestyle and enjoy their home. To them, this is the true return on investment in their home.
How long do I plan to own this property? If you're planning to live in your home for less than five years, take on remodeling projects that freshen up the inside of the home and promote curb appeal.
How does the value of my home compare to other properties in the area? Generally, a remodeling project that is less than 20 percent of the average resale value in your area can be recouped when your home is sold.
The tables below compare remodeling costs to resale values for midrange and upscale remodeling projects in the Middle Atlantic region, which includes New York, New Jersey and Pennsylvania. According to REMODELING Magazine's report, different remodeling projects offer a wide range of payback. For 2012, ROI (shown in the tables below as the % of Cost Recouped at Resale) declined slightly by 1 or 2 percentage points for most projects due to a sluggish economy. Both tables list projects ranked by the greatest percentage of payback.
|Midrange Project||Avg. Cost||Resale Value||% Cost Recouped|
|Add an attic bedroom||$53,871||$38,113||68|
|Replace front entry door with steel door||$1,293||$861||67|
|Vinyl siding replacement||$12,024||$8,068||67|
|Garage door replacement||$1,565||$1,025||66|
|Minor kitchen remodel||$20,067||$13,050||65|
|Wood deck addition||$10,490||$6,763||65|
|Vinyl replacement windows||$11,904||$7,441||63|
|Major kitchen remodel||$59,731||$36,346||61|
|Wood window replacement||$12,858||$7,838||61|
|Composite deck addition||$15,900||$9,393||58|
|Master suite addition||$112,788||$63,821||57|
|Family room addition||$87,989||$48,429||55|
|Entry door replacement - fiberglass||$3,644||$1,976||54|
|Backup power generator||$15,617||$7,240||46|
|Home office remodel||$28,955||$11,296||39|
|Upscale Project||Avg. Cost||Resale Value||% Cost Recouped|
|Fiber cement siding replacement||$13,630||$9,671||71|
|Foam-backed vinyl siding replacement||$14,607||$9,720||67|
|Garage door replacement||$3,019||$2,015||67|
|Vinyl replacement windows||$15,116||$9,167||61|
|Wood window replacement||$19,787||$11,217||58|
|Grand entrance - fiberglass||$7,781||$4,477||58|
|Major kitchen remodel||$114,041||$62,871||55|
|Deck addition (composite)||$38,872||$19,530||50|
|Master suite addition||$236,937||$112,033||47|
Estimates for project costs and resale values were developed by a Research Team for REMODELING Magazine. The value you can expect to recoup at resale from your remodeling project is contingent on what the contractor brings to the table. Price quotes will vary so it is important to consider a contractor’s experience and the materials that will be used for the project. In selecting a contractor, review the portfolio of the contractor’s work and ask to visit projects the contractor has completed.