Smaller home renovation projects with a big impact on aesthetic appeal will pack the biggest bang for the buck in 2019, a new report finds. Less expensive but highly visible projects, like a new garage door or a minor kitchen, remodel, top “Remodeling” magazine’s annual Cost vs. Value report.”When you are buying a property, one of the things you want to check off is, do I have a functional kitchen I can live with before I make it my own?” said Clayton DeKorne, chief editor of the JLC Group, which includes Remodeling magazine.
Conversely, spending hundreds of thousands of dollars on a master suite addition or a major kitchen revamp may make you and your family happy, but it won’t necessarily lead to a big payday when it comes time to sell, the report finds. While such major projects may enhance comfort or make a home more functional, you might be lucky to get a bit more than half your money back. “That is because of all the decision making that goes into a project like that from the homeowner,” DeKorne said. “There are so many particular or subjective decisions that go into that.”
As we head deeper into 2019, there are other reasons as well for homeowners to be cautious when embarking on home renovation projects. Home prices appear to be peaking in number of markets across the country while sales are flat. A slowing real estate market, in turn, could make it that much harder for home sellers to recoup tens or even hundreds of thousands of dollars spent on various home renovation projects.
Here are the top six and bottom six home renovation projects, ranked by return on investment:
This can be a relatively inexpensive way to spruce up the curb appeal of your home. The ROI for a mid-range, $1,826 steel door is just under 75%, or $1,368. Steel doors are stronger than their fiberglass and wood counterparts, providing greater security while also not prone to warping or cracking. Steel doors also come in a variety of styles and colors. Still, the best days may be behind the steel entry door. It has become significantly less cost effective since 2015, when home sellers could not only recoup their costs, but earn a nearly 20% return.
Apparently nothing says this is home to a home buyer like a new wood deck. A wood deck will put you out $13,333, with an eventual return of $10,083 when you sell. That’s an ROI of 75.6%, down a bit from 2018, when it was more than 80%, but still high. The cost covers a 16-by-20 deck, with 4-by-4 posts embedded in concrete piers, railings and a built-in bench and planter. By comparison, a mid-range deck made of composite material, at $19,150, will cost considerably more to build. With a return of $13,232, or 69.1%, you’ll also be out nearly $6,000, compared to $3,250 for a wood deck.
The bad news is that you can only expect to recoup 59.7% of your costs. Major kitchen remodels often involved a myriad of subjective choices based on personal taste that may not necessarily mesh with the preferences of prospective buyers who may want to do their own thing, said JLC and Remodeling magazine’s DeKorne. The good news is the amount you can expect to get back when you sell is up from 53.5% in 2018.
Just outside the master bath, you can relax at the “5-foot-long hospitality center with bar sink, undercounter refrigerator, custom cabinetry, stone countertop.” The project’s payback ratio is up from 48.3% last year, but down sharply from 2017, when it was just under 60%.