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.
If you want to boost the appeal of your house in a hurry, new siding will get the job done quickly, while also not breaking the bank. Replacing 1,250-square-feet of siding will cost $16,036, of which you can expect to recoup $12,119, or 75.6%. Mid-grade cedar will cost you $4 a square foot to install, while vinyl siding will put you out $1.60, by comparison, according to This Old House. Nearly a third of all new homes now come with vinyl siding, which is easier to maintain - no painting required.
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.
This is equivalent to a face-lift for your kitchen. A mid-range kitchen remodel will put you out $22,507 for new cabinet fronts - but not new cabinets - as well as for new "shaker-style wood panels and drawer fronts, including new hardware" (knobs and the like). The cost also includes all new, energy-efficient appliances, new countertops and new "mid-priced sink and faucet," as well as new "resilient flooring." Topping it off is a paint job for the walls, the trim and the ceiling. The payback for this project is 80.5% and has been fairly high since 2014, when the real estate market started to kick back into gear in earnest. A minor kitchen rehab is also likely to be a crowd-pleaser with buyers, giving them a few years of breathing space before they consider embarking on a major overhaul, Remodeling magazine.
New siding may be a reliable way to boost your home's value, but there's nothing like a little stonework, even if it comes from a factory. A mid-range stone veneer will put you out $8,907 but you will get back nearly 95% of that, or $8,449, when you sell. The project involves replacing the bottom third of the house's street-facing façade with 300 square feet of manufactured stone veneer. The payback value has increased significantly since 2017, when it was 89.4%.
Spiffing up the curb appeal of your house with a new, upscale garage door is the best renovation bet in 2019. This project involves getting rid of the typical, dreary, 16 by 7 garage door and replacing it with an antique-like, four-section door with ornamental handles and windows on the top panel. Better yet, the new $3,611 garage door is likely energy efficient, with foam insulation and thermal seals on the window. Payback is 97.5%, or $3,520.
This prototypical dream bathroom project involves more than doubling the size of a modest, 35-square-foot bathroom into one that is 100-square feet. The project features a "42x42-inch neo-angle shower with ceramic tile walls with accent strip, recessed shower caddy, body-spray fixtures, and frameless glass enclosure." It also includes a "free-standing soaker tub with high-end faucets," a "stone countertop with two sinks" and "electric in-floor heating." It is so nice you'll never want to leave the bathroom, but after spending $64,743, the project's payback value of 60.2% could leave you feeling a bit soaked, though it's an improvement over 2018's 56.2%.
This is the dream kitchen to go with your dream bathroom. For $131,510, you'll get 30 feet of new, "custom white cabinets," complete with "built-in sliding shelves and other interior accessories." Your new dream kitchen will also include new stone countertops with an expensive "ceramic- or glass-tile backsplash," as well as a "built in refrigerator" and "a commercial-grade cooktop and vent hood, wall oven, and built-in microwave unit." High-lighting and "designer faucets," a water filtration system and tile or other flooring "that looks like wood" rounds things out.
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.
Compared to the cost of upscale kitchen remodel, adding a mid-range master suite addition would appear to be a bargain, coming in just a shade below at $130,986. For that price, you get 24-by-16 master bedroom, including a bathroom complete with a tub and shower and a walk-in closet. However, the payback, at 59.4%, is .3% lower than what you can expect to get back from that upscale kitchen remodel, so go figure.
This involves similar, high-end fixtures and flooring discussed earlier with the upscale bathroom remodel. The difference this project involves adding a new, 100-square-foot bathroom to the master bedroom. You can expect to eventually earn back 58.1% of the new, deluxe bathroom's $87,704 cost, or $51,000. That's up from 54.6% last year, but down from more than 60% in 2014.
OK, this isn't your dad's patio, even if it isn't the deluxe version. This 20-by-20 flagstone patio will cost you nearly $57,000 to install and comes with a gas-powered fire pit in the center, as well as a "stone veneer modular kitchen unit with gas grill, mini-refrigerator, sink and storage." Topping it off, literally, is a 20-by-20 cedar pergola for the awning that will keep everyone cool in hot weather, as well as low-voltage lights so you can party at night. You can expect to recoup 55.2 %, or $31,430, of the new patio's cost when it comes time to sell.
Just about the only home renovation that offers less of a payback than the mid-range master suite addition is the upscale version. It also has the honor of being 2019's least cost-effective home renovation project. This 32-by-20 master bedroom suite will cost you $271,470 to build, more than an entire house in some parts of the country. However, while you can expect to earn back just 50.4% on your spacious master suite, you also may be in no rush to sell. The upscale master suite includes a "lounging/sitting" area, as well as a well-appointed master bath, custom-built bookcases, a gas fireplace with a stone hearth, French doors, and a "walk-in closet/dressing area with natural light, mirrors, and linen storage." And did I forget to mention the bar?
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%.