Are you eager to renovate parts of your home but aren't sure which projects will actually add value to it? Before you start ripping out walls or buying expensive faucets, learn which remodeling projects can actually pay you back when you decide to sell.
Homeowners across the country are trying to increase the value of their homes through remodeling projects.
In fact, 30 percent of homeowners say their main reason for a home remodel was to increase the value of their home, according to an October 2011 national survey of homeowners and renters, commissioned by Hanley Wood LLC, a media and information company in the housing and construction arena.
But just what is a home renovation worth?
"Everything you do to improve your home can add some value," says Steve Melman, director of economic services for the National Association of Home Builders in Washington, D.C. But Melman adds an important caveat: "Paybacks for remodeling have been falling, just like the price of homes," so it's important to know which projects will give you the most bang for your buck.
Fortunately, there are certain remodeling projects that could pay off big down the road. Keep reading to learn more...
Remodeling Investment #1 - Replace Siding
One of the top remodeling projects for adding value to your home isn't anything too complicated or arduous. It's as simple as replacing the siding on the outside of your home.
Just like we dress for success on job interviews, your home needs to make a good first impression on potential buyers when they see it from the street. In the real estate world, this is called curb appeal.
In fact, if you replace your exterior siding with fiber-cement - a composite material made of sand, cement, and cellulose - your home could recoup 78 percent of the average nationwide cost of the project, $13,641, according to a 2011-2012 "Cost vs. Value Report" conducted by Remodeling magazine.
If you want to shell out a little less, try vinyl siding, which costs about $11,729 and has an average recoup percentage of 69.5. Foam-backed vinyl siding is also available for a similar recoup value, though it comes with a higher price tag of $14,274.
Seven of the top 10 projects in Remodeling's report are classified as siding, window, or door replacement. These projects cost less than $19,000 and boast an average cost-to-value ratio between 69 and 78 percent. Clearly, making a home's exterior look good can entice more potential buyers to see what else it has to offer.
Remodeling Investment #2 - Replace Old Windows
Want to make a great remodeling investment in your home and feel good about it?
Updating your windows could be the answer. Whether you select vinyl or wood windows to replace drafty old ones, you can recoup up to 69.1 percent of the project's cost on your home's resale value, according to Remodeling's "Cost vs. Value Report." Window replacement costs average from a low $11,000 to $19,000.
New windows do so much for the look of a home inside and out, and as Melman points out, they make cleaning a breeze (pun intended).
"I have a 90-year-old home with old windows," says Melman. "When you try to clean them, the ropes that lift them up usually break. It's a pain, and they aren't insulated like the new windows." If this scenario sounds all too familiar, you're not alone.
According to the Hanley Wood survey, "More than half of the nation's 76 million owner-occupied homes were built prior to 1970." That means there are a lot of old windows out there that need some serious TLC.
Remodeling Investment #3 - Install a New Roof
Frosting on a cake - it's what buyers see when they drive up to a home with a brand-spanking-new roof.
If missing roof tiles are making your home look like it's seen better days, it might be time to invest in something new and attractive that could pay back more than half of the construction costs.
An upscale new roof using standing-seam metal can be quite costly, demanding a $37,481