Transforming problem houses into Dream Homes

What Remodeling Project is Best?

I am often asked what remodeling project provides the best return on the investment? That is actually a complicated question. The answer depends on many factors: location, age of the house, how long you intend to stay in the house, and how you calculate the return. So with that in mind, I was interested to see this report.

Does your kitchen need updating?
Does your kitchen need updating?

These are national averages, not specific to the Bay Area. (Here are the numbers for the Bay Area.) The “return” is assumed to be the increased value of the house after the remodeling project. 10 years ago, you could get over 100% returns on investment for some remodeling projects. In this economy, that is no longer the case. At best these days, you get a return of roughly 85%…which is really a loss of 15%.

If you intend to live in your house for more than 5 years, the “return” on your investment should include energy savings from new exterior doors and windows. Those saving will equal lower energy costs for you. The other “return” on your investment is not monetary, but the improved quality of your life. Having a kitchen or bathroom that better suits your life or more storage where it does the most good, can make your life immeasurably easier or more pleasurable.

Similarly, if you want to sell a house, fixing the weirdnesses of layout, storage, lighting and other things can make a sale happen earlier than trying to unload a weird, dark house without enough storage. Reducing that period of time the house is listed and the stress around that can be worth way more than the financial return, though it can equate to a higher sale price as well.

I disagree with some of their recommendations. An uninsulated garage door is not a good idea if you have a workshop or laundry in the garage. Laminate counters are nice, “green’ products, made mostly of recycled materials and no longer made with nasty chemicals. But if you are trying to sell a house, granite, quartz or Corian might be better choices.

Overall, it’s an interesting article and can be used to raise some questions with your real estate agent or architect.


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