With so much attention focused on the housing market these days, you might be thinking of sprucing up your home. Renovation projects can be expensive, of course. On average, homeowners spend about $15,000, and a kitchen or bath remodel can run significantly higher.
If you want to know how to increase home value, bear in mind that certain projects will pay off better than others. Your return on investment can depend on the type of changes that you make, your location, and how competitive the housing market is. Here is what you need to know.
- Homeowners spend an average of $15,000 on home renovation projects.
- Very few projects will pay back 100% of your costs when you sell the home.
- However, some renovations can improve your home’s appeal to buyers, helping it sell faster.
- Renovations can also make your home more energy-efficient, saving you money, and simply more enjoyable to live in it.
How to Increase Your Home Value for $15,000 or Less
If you want to make a relatively modest investment in renovations while also recouping some of that money by boosting your home’s value, here are seven projects to consider. The first four are based on Remodeling magazine’s new “2021 Cost vs. Value Report,” the last three on the “2019 Remodeling Impact Report” from the National Association of Realtors (NAR):
1. Replace Your Garage Door
One of the most effective ways to upgrade the curb appeal of your home is to replace your existing garage door with a modern steel one. According to Remodeling magazine’s “2021 Cost vs. Value Report,” the new garage door will cost $3,907 on average and recoup 94% of its value, or $3,663.
2. Add a Stone Veneer
If the front of your home has old brickwork or nondescript siding, then consider installing a manufactured stone veneer over a portion of it. It will make the house look more stately, and you’ll likely get back about 92% of its cost when you sell the home. A manufactured stone veneer runs $10,386 on average.
3. Upgrade the Entry Door
If you have an older front door, it can make your house look drab, and it may not be as secure or energy efficient as today’s models. A new steel door would cost about $2,080, but you would recover $1,350 or so at the time of sale, or 65%.
4. Create a Grand Entrance
A more ambitious (and costly) front-door project is to widen the entrance, while adding new fiberglass trim and lighting. The average cost of installing a so-called grand entrance is $10,044, and you’ll recoup 61% of your investment.
5. Install New Wood Flooring
If your home has carpet or older tile, new wood flooring will increase its interior appeal. The benefits can be significant; homes with new wood floors are easier to sell, and you can actually make money on this renovation, unlike virtually any other project. The average cost of new flooring, according to the NAR’s “2019 Remodeling Impact Report,” is $4,700, while the estimated cost recovered was $5,000, or 106% of the investment.
6. Update or Replace the HVAC System
Updating or replacing your heating, ventilation, and air conditioning (HVAC) system can boost both your home’s salability and value. The typical cost of an HVAC replacement is $8,200, and the estimated cost recovered is about 85% of that, or $7,000.
7. Improve Your Insulation
Your home’s insulation is important for both your comfort and budget. Upgrading it can improve your home’s energy efficiency while helping keep out unwanted noise from traffic or neighbors. The average cost to upgrade insulation is $2,400, and you’re likely to recover 83% of the expense, or $2,000.
The Bottom Line
Renovating your home can improve its livability and boost your chances of selling for your asking price—or more—quickly when that day comes. However, some projects offer a better return on investment than others. If you’re planning to list your home for sale anytime soon, consider consulting with a knowledgeable local real estate agent to find out which projects (if any) would make a difference to likely buyers.