Chances are high that your home isn’t exactly the way you want it. If the things you’ve been wanting are a trendy look to the great room, new wood flooring or a piece of furniture (or three), it’s pretty easy to say “Yes, let’s!” as long as you have the funds.
But what about if the change you want is substantial and involves improvements that won’t go with you when you move? Perhaps the kitchen is embarrassingly outdated, the lower level a disappointment, the sun porch still just a dream. How do you decide if it’s worth it to put money into your present home with a remodel project?
“In terms of getting a return on investment (ROI), you will never get the remodeling dollars back out of the house when it’s time to sell,” says Todd Fisher, owner of A to Z Remodeling in Englewood. “A good remodeling project will absolutely improve your home and make it easier to sell when that time comes. But almost without exception, you’ll never recoup everything you spent.”
Experts agree that the only “fix-up” guaranteed to pay off 100 percent in return at sale time is a can of paint.
When you undertake a remodeling project, you should be doing it because you want it for the home you’re planning on living in for awhile.
“The shorter time you’re planning on keeping your house, the less you should be considering a remodeling project,” says Erich Eggers, co-owner of Remodeling Designs in Dayton. “If you’re staying in your home for the next five years, sure, now’s a good time to consider remodeling.”
What you’ll spend, what you’ll recoup
You might not recoup all your money but remodeling definitely makes it easier to sell your home and does bump up your asking price.
Each year, Remodeling Magazine offers their popular “Cost vs. Value Report,” listing a project-by-project chart for each area of the country, showing how much of the average project can be expected to be recouped in increased value to a home.
The top project for 2013 is pretty boring: If you put in a steel front door, the ROI is projected to be 85.6 percent.
In terms of room renovation, the report says a major kitchen remodel in the midrange area should recoup about 68 percent. A high-end kitchen remodel will return about 59.7 percent.
A mid-range bathroom remodel has an ROI predicted to be 65.2 percent. A basement remodel has an ROI of 70.3 percent.
Cathy Johnson, co-owner of Kitchens By Design in Kettering, says kitchen and bath remodeling are two popular choices for homeowners wanting to update their homes. “The average kitchen remodeling project around this area is $18,000 to $40,000,” she reports. “The average bathroom remodeling is $8,000 to $15,000.”
Eggers says to count on about $50 a square foot to finish a basement.
But remodelers advise to consider the value of your home when deciding how much to invest.
“The sky is the limit with what you can put into your remodeling project but having a $40,000 kitchen remodel for a $60,000 home is foolish,” Johnson says.
Look at other homes in your neighborhood that are for sale. Visit their online listings to see photos of the rooms you want to remodel. Do the updates you’re thinking about fit with the value of homes in your area?
“Recently condo owners asked me about remodeling their kitchen and two bathrooms. They are planning on moving in three years or so,” Eggers says. “To get the improvements that these owners want would cost around $50,000 and their condo is probably worth around $110,000. I recommended that they move now, get the place they want and save money by not remodeling.”
A good remodeler will “tell it like it is” and give you good advice about whether or not remodeling is for you.