Best ROI Upgrades For Any Home
Someday, whether you’re downsizing or moving to another region, you’ll probably want to sell your home. Whether this is something you’ll be doing in one year, five years or 20 years, spending time and money upgrading your house now will increase its market value. And meanwhile, of course, you’ll be able to enjoy these upgrades yourself!
However, it’s crucial to recognize that not all home upgrades yield equal benefits. While the allure of transforming a bathroom into a serene spa retreat may be strong, its cost might not justify the return upon resale. Conversely, addressing practical issues like replacing gutters or repairing a leaky roof tends to have a more pronounced impact on a home’s value, albeit lacking the glamor of luxury renovations.
Emphasizing the ROI of home upgrades can further elevate your property’s value, which will benefit you when you decide to list your home for sale. With that being said, let’s move on to see which home upgrades have the best ROI.
The 10 Best Home Improvements for ROI
- Minor Bathroom Renovation: Average return of 102%
- Landscaping: Average return of 100%
- Minor Kitchen Renovation: Average return of 98.5%
- Attic Bedroom Conversion: Average return of 93.5%
- Major Bathroom Renovation: Average return of 93.2%
- Major Kitchen Renovation: Average return of 91%
- Entry Door Replacement: Average return of 90.7%
- Adding a Deck/Patio/Porch: Average return of 90.3%
- Basement Renovation: Average return of 90.1%
- Replace Windows: Average return of 89.6%
1. Minor bathroom renovation
- Average Cost: $10,500
- Average Return: $10,700
- ROI: 102.0%
Kitchens and bathrooms are the two rooms that most often sell homes. The bathroom remodels have the highest ROI. It may be more beneficial to remodel a bathroom than start a project in every room. It’s not necessary to gut the entire room. However, updating each bathroom could make a big difference. Replace the shower head with one that is a rain shower head. This is a feature that most homebuyers appreciate. Replace the vanity as well, since nobody wants to use someone else’s old bathroom. At the same, update the lighting in order to brighten the room.
2. Landscaping
- Average Cost: $4,900
- Average Return: $4,900
- ROI: 100.0%
Spending money on the exterior of the home is a great way to maximize your rehab budget. Even if nothing else, curb attraction helps to sell homes. A new landscaping may be the perfect solution to make your home look appealing and fresh. Make a good impression by updating the landscaping. You don’t need to go crazy. The best landscape designs are simple, but “lines” must be cleaned and trimmed. The landscaping should be attractive, but not overly complicated.
3. Minor kitchen renovation
- Average Cost: $15,000
- Average Return: $14,600
- ROI: 98.5%
Minor kitchen renovations can increase the ROI of home improvements without destroying an entire room. Try minor upgrades to make a difference. Start by replacing your old kitchen appliances with newer, better ones. Instead of replacing cabinets, refinish the ones you have. With a fresh coat of gloss or paint, old cabinets can look brand new. This, along with new hardware can transform the kitchen.
4. Attic bedroom conversion
- Average Cost: $38,200
- Average Return: $36,700
- ROI: 93.5%
If your home has a converted attic, you should think about turning it into an additional room. The number of rooms in a house is one of the best ways to increase the home’s value. Anyone who has the option to increase their room count should consider it.
5. Major bathroom renovation
- Average Cost: $26,000
- Average Return: $24,300
- ROI: 93.2%
It’s time to go one step further with the minor bathroom renovation we discussed earlier. Homeowners should think about a total overhaul instead of just replacing a few things and upgrading others. This will boost their ROI on home improvements. The shower pan, flooring, lighting, and plumbing should all be evaluated and critiqued. If it doesn’t add to the appeal of a bathroom, then it is taking it away. It may be best to start from scratch. Upgrades to the bathroom, and especially the master bathroom, can convince buyers that they’re making the right decision.
6. Major kitchen renovation
- Average Cost: $43,900
- Average Return: $39,900
- ROI: 91.0%
A major kitchen renovation should be similar to a major bathroom renovation. Everything will need to be removed and re-done. Also, it is a good idea if you incorporate an open concept. Try to remove a wall if you can. Kitchens that are spacious, both to host guests and cook in, appeal to buyers. One of the best things that homeowners can do to improve their kitchen is to remove the wall that separates it from the rest of the house.
7. Entry door replacement
- Average Cost: $1,410
- Average Return: $1,280
- ROI: 90.7%
The entry door replacement, as the easiest item on the list is probably the most impactful. A new entry door is likely to be the first thing buyers notice, just like landscaping. The owner has the opportunity to make a great first impression. Most people decide if they want to purchase a house within the first few moments of viewing it. It’s therefore in the best interest of homeowners to improve curb appeal.
8. Adding a deck/patio/porch
- Average Cost: $11,000
- Average Return: $10,000
- ROI: 90.3%
If there is enough space, homeowners may want to consider adding a patio, deck or porch. These types of exterior structures can increase the perceived value of a house. A deck can at least increase the amount of living space available in a yard. It could, at most, be the selling point that a buyer has been looking for.
9. Basement renovation
- Average Cost: $51,000
- Average Return: $46,000
- ROI: 90.1%
Some homes do not have basements, but those who do may wish to remodel their basements. This could easily increase the amount of living space in a house. Try to make the basement a selling point instead of keeping it dark and dingy (which can actually harm the chances of a home sale).
10. Replace windows
- Average Cost: $9,700
- Average Return: $8,700
- ROI: 89.6%
A new set of windows can improve the exterior of your home more than a new coat of paint or a new garage door. New windows have clean lines that can make a house look more attractive from the outside as well as inside. These windows should also be more energy-efficient. New homeowners could save a lot on their energy bills with the right windows.
The importance of curb appeal
Curb appeal is important in even the most competitive housing markets. Anyone who sees the exterior of your home will not want to go inside. The exterior is what influences a person’s decision to spend large amounts of money on a home. It should be the first thing to consider when undertaking any home improvement project.
Siding replacements, along with other exterior projects, are high on our list of home improvement ROI because they have a great curb appeal. Curb appeal creates interest in your house, which will then drive interested people inside. Home improvement projects that increase curb appeal can result in a greater interest in the property and higher ROI.
Take into account the trends in your area
When updating or remodeling your house, trends are something to consider. It does not have to be about home design, but rather any factor that is influencing the local home-buying market. In recent years, for example, people are becoming more environmentally aware. If this is the case in your area, energy-efficient appliances or smart home features may have a high return on investment. These elements can save homeowners money on utility bills, and they’re also becoming more desirable. Search for recently sold properties on listing websites such as Zillow and RedFin. You may get some great ideas for home renovations or trends in your area.
Other home upgrades to make
You may be surprised to find that some home improvement projects are worth the effort, even if they’re not the most popular. Consider these changes if you want to get the best return on investment.
- Hardwood floors are preferred by most buyers over carpet. You can skip this project if your carpet is still in good shape. If your carpets have become outdated, or if you own pets, then it is worth spending the extra money to install new hardwood.
- The exterior siding of your home has a significant impact on the perceived value. The outside of the house will be the first thing a potential buyer sees when they view the property. Replace your siding with durable materials if it is outdated. This will improve curb appeal and increase ROI.
- Smart Thermostats – Modern buyers are drawn to energy efficient homes and smart appliances. Smart thermostats let homeowners control the electricity consumption of their homes and can even lower their monthly bills. A smart thermostat that costs a few hundred bucks can be attractive to buyers, and provide a good return on investment.
- Décor: By staging the property, buyers can better visualize the space’s potential and increase its perceived value. Invest in furniture or decorative pieces that you can reuse in future properties. You can also remove excess clutter, like personal photos, from the current space. This will help potential buyers imagine themselves living in the house and if they decide to purchase it, it would be theirs.
Common home upgrade mistakes to avoid
Ignoring local trends is one of the biggest mistakes sellers make when they are improving their property. You need to focus on what is selling in the area. Consider the home sales of the area, including the immediate neighborhood. What are the most valuable features? What were the design choices made for these properties? Attention to local trends will increase the value of your house. You could lose money if you ignore them.
A common mistake is spending too much money on renovations. There are many changes that can be made to increase your ROI, but there is also a limit. Ask yourself if the money you spend on each project will be recouped in a realistic time frame. Spending upwards of 100,000 installing a swimming pool only to have the property sold for $10,000 more is a common pitfall. Plan carefully and consider the value that can be added.
In conclusion
If you intend to stay in your house for at least five years, it is okay to upgrade your home to suit your lifestyle and preferences. However, if your goal is to increase the profit when you sell your home, it’s important to focus on the ROI of your home upgrades. Home improvements that increase ROI simultaneously boost demand and value. Homeowners can’t just make any upgrade they want. They need to make the correct upgrades. The home improvements that have the highest ROI will be more effective and worth it than any other.
Of course, this is just general information. There can be wide geographic differences. Some features are almost mandatory in one area but are met with “who cares?” in others. When it comes to Realtors in Savannah, we’re the experts who know what works in your neck of the woods. When you’re ready to take action and guarantee yourself a satisfactory ROI on your home, we’re only a phone call away!
