To continue with the annual tradition of remodeling cost and its payback, Realtor and Remodeling magazine brought back the survey for 2007 remodeling costs from around the nation. Going along with the market trends, it shows that the value of remodeling trended down because of the same economic reasons facing housing: 1) Rising (remodeling) costs, and 2) Declining home values.
What they don't mention in the survey, is what is your return on investment if you just do some really basic minor jobs, i.e. painting, replacing carpet to hardwood, etc. In reality, a good quality hardwood flooring 'wow' buyers more than carpet! The return on energy-efficient appliances still missing. There will come a day when energy-efficient appliances become the 'it' trend.
Of all types of remodeling, minor kitchen job (ROI = 83%) holds its value in comparison to upscale remodeling job, like siding replacement using fiber cement materials (88.1%).
The remodeling costs also depends on which part of the country your home is located. For mid-Atlantic region, here is a sample of remodeling jobs with the return of investments. Using data from Remodeling and Realtor.
- Deck wood addition (85.6%)
- Minor kitchen (82.7%) vs. upscale major kitchen work (79.3%)
- Siding replacement using fiber-cement materials (89.4%) vs. upscale roofing (69.9%)
For Washington DC region DC/MD/VA. Upscale siding replacement pays back 87.4% of your investment at resale. Deck addition, surprisingly holds the highest return of 98.1%. Window replacement ROI 83.1% vs. minor kitchen remodel 81.9%. When you put value in the context, using the data, a minor kitchen remodel would cost you on average $21,109 with payback at resale of 81.9%. While deck addition would cost you on ave. $10,260 with ROI estimate at 98.1%.
So- before doing any remodeling job, get your budget straight and weigh all options to determine which part of your house that would get the makeover first. The job that potentially has the highest potential returns for your money.
Depending on your location, to get the most bang for your buck, especially if you're selling, you might want to get some idea from region specific report, here.