Looking to Improve Home Value? Avoid These Projects With Terrible ROI

How to Improve Home Value

Begin by taking a look at what Citi Living Solutions in NJ suggests about your home’s renovation ROI

For the first and second quarters of 2023, We surveyed 1,300 top-performing realtors across the United States about the average return on regular home improvement projects.

To facilitate this, we gave respondents an estimated cost average for the project using data from HomeAdvisor.

We asked the respondents to estimate the potential amount they thought the project would bring to the value of a home at resales. By comparing the median cost to the top estimates from agents, we then calculated the expected ROI for each project.

What we discovered is that, in general it’s better to spend less on smaller-scale projects rather than trying to recover the cost of more considerable improvements.

  • De-cluttering and cleaning will definitely benefit your home and appear more appealing But top agents affirm that these tasks will improve your profit margins.
  • If you spend $167 cleaning your house, you’ll get back an average of $1,728, which is a return of $935.
  • Get rid of $486 in clutter, and you’ll bring in $2,584 to your bottom line, which is a 432 percent return on investment. Don’t take advantage of these simple tasks and you’ll end up leaving hundreds of dollars unused.
  • Bathroom and kitchen renovations are basically a washing. There’s a higher chance of losing money with these massive projects.

For the exterior, the top two tasks will be basic lawn maintenance (352 percent ROI) and fresh mulch (126 percent ROI). Do not invest in the most expensive landscaping, which has an ROI of -9.

Based on our own research and other reliable sourcing sources such as our sources, including the National Association of Realtors and top real estate agents from the HomeLight network, we have compiled this list of the most important must-haves and no-nos in the field of home remodeling.

1. DON’T: Drop big bucks on a full kitchen renovation

If your home was built over 10 years ago and hasn’t been renovated, you’re living in an uninspiring kitchen. If you’ve spent any time cooking it, there’s a good chance you’ve thought of taking it apart several times.

Selling the property might seem like the perfect moment to start making that dream kitchen a reality, but the cost might surprise you.

In its 2017 Remodeling Impact Report, the National Association of Realtors (NAR) discovered that homeowners typically invest around $65,000 for the entire kitchen remodel. However, they only get an ROI of $40,000, which is only a 62 percent return.

Based on data from HomeLight, Top real estate agents believe that for a smaller scale of $23,140 for kitchen upgrades, buyers would get back $23,122 when selling their home, for an -0.08 percent ROI. So it’s better, but you still don’t break even.

If you decide to make a major kitchen remodel without consulting a professional, you’ll probably spend more money than necessary on the wrong design decisions.

“One of my clients chose all of her own upgrades, and the combination of the countertop with the backsplash couldn’t have been worse if she had intended to pick the worst,” says Gaddis.”It took us thirty-four months before selling the property We ended up having to replace the backsplash and she was able to spend twice as much on the renovations than she would have initially.”

2. DO GIVE the kitchen a makeover of less than $5,000

The reality is that Gaddis’s client could have had the appearance of a completely modernized kitchen with only some thousand dollars on the proper things.

“If you’re improving the kitchen, you’ll never get your money back by changing out the cabinets,” suggests Gaddis. “Instead, just do cosmetic fixes like painting the existing cabinets, changing out the cabinet hardware, and replacing the countertops with granite.”

With an average cost of less than $3000 across the nation, replacing countertops is by far the most costly element of this small kitchen renovation. The final price will depend on the materials, edges, and backsplash options you choose.

Install the countertops, paint the cabinets for $600 to $1,000, then spend up to $500 replacing the faucet, sink and cabinet hardware. The kitchen will appear like an entire remodel with under $5,000.

3. DO NOT: Completely remodel the bathroom

The bathroom is arguably the most shabby within the home It’s also the most glitzy. On one hand renovating the bathroom completely is logical. With an average cost of $30,00, it’s less than re-doing the kitchen.

4. DO: Replace outdated fixtures

Do you want to know what indicates how old your bathroom is? It’s the fixtures—both the lighting and faucets. You can change them without spending a lot to achieve the “brand-new bathroom” look.

“In the bathrooms, it’s all about the mirrors and the fixtures,” says Gaddis. “Light and faucets have to be modern. If you have older mirrors, consider adding a framed border or place smaller mirrors above sinks for both of them.”

The idea of replacing fixtures may sound expensive, with an estimated cost of $500 for each faucet. But remember that the largest portion of that cost is labor. You can cut down that cost by installing all plumbing fixtures in one go, including sink, shower, and tub faucets in the kitchen and bathrooms.

Buy moderately priced fixtures and faucets ahead of time to save money. Your realtor can also give you suggestions on finishes and style. Place them in the space where you’d like to install them to ensure that each fixture is installed in the proper place.

Completing these tasks could save you more, but only if you can warrant a professional appearance. The most important thing you do not want to do is have to purchase fixtures twice because your DIY efforts resulted in fixtures that are installed improperly or poorly.

Be aware that DIY installation isn’t as simple in bathrooms due to the cramped space and difficult-to-reach places and nooks.

Perhaps, for instance, the successful installation of new flooring in the squared-off floorspace in the bedroom has boosted your confidence. In the bathroom, however, you’ll have to take care with the cuts (and numerous cut-offs) to place square tiles at an awkward angle around the toilet, sink, and bathtub.

5. Don’t: finish the basement

“The bigger the house, the higher the price.” This is a reasonable assumption, but it’s only valid in the broadest sense.

The 2003 NAR study showed that each additional 1,000 square feet boosts the value of homes sold by about 3.3 percent. But the location where you add the extra square footage is important.

If you’re not adding an extra room on the ground floor (which could be detrimental to your property in your yard by reducing the space), It’s unlikely to make that big of a profit just by transforming your basement into more area for living.

“Some clients think they can finish the basement area in a home and make a good return,” Gaddis says. Gaddis. “The truth is, basement space within the Metro Atlanta area is probably not worth more than one-third per square foot compared to other areas of the home. Therefore, you won’t get the cashback.”

On average, you’ll pay about $40,000 to bring your basement in order for it to be considered more living space. And you’ll only receive $25,000 in return for the effort. That’s 63% of a return on investment.

This assumes that you don’t encounter problems. Reworking an above-ground area is not the same as reworking an above-ground area.

In the beginning, you’ll require special drywall that can withstand moldy, damp basement conditions. You’ll also need to create an accessible exterior to conceal your home’s appliances, such as the furnace, water heater plumbing, and laundry area.

Also, the additional effort and cost required to make a basement habitable aren’t worth it if all you’re looking to accomplish is improving the value of your home.

6. DO: Re-paint and replace carpeting in your living spaces.

Instead of investing money in the addition of a few square feet or living spaces, it’s more beneficial to make your existing living spaces more welcoming and liveable by painting them and installing new flooring.

Fresh paint can be similar to that “new car” smell for homes. That’s why many agents suggest that their clients get the interiors of their homes painted, even if it’s the only improvement they’re able to complete.

A variety of figures go into painting costs, including the area of the room, the paint brand you choose to use, the number of colours you select for your rooms and walls, and whether or not you paint your baseboards and trim them a different color. The possibilities are endless.

The person you select to complete the job can make an impact. If you don’t have the ability and time to DIY, it’s better to hire a skilled professional to finish the job correctly and faster.

It’s a low estimate when you consider the amount of potential buyers are turned off due to stained, old and traffic-spread carpeting. Although there’s no guarantee you’ll make money from your property by putting in new flooring, it isn’t likely to be able to recover the cost of that investment.

Most agents will tell you that fresh flooring and paint can help you sell your home more quickly, which will save you money over the long term.

If you choose to hire a professional to fix the flooring and walls, be sure to talk to your agent before you do so.

Not only will they benefit you choose the right material and colors, but they’re likely to have connections with professionals in flooring and painting who’ll offer you deals in exchange for their recommendation.

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