It’s the summer time! Should I remodel my home?
We are now 2 weeks into summer, and a fierce heatwave has been washing across North America. On the plus side, the dry weather provides a fantastic opportunity for people to work on their homes. Whether it’s a new coat of exterior paint, new kitchen counters, or a whole new bathroom, we know one thing for sure: it’s going to cost you.
Will I get a return on my home improvement?
For the purposes of this article, we’ll assume that the purpose of remodeling is to improve your home’s value. Otherwise, the choice to make a home improvement is completely up to the individual’s tastes and wants. So, let’s take a look at some of the statistics on various home improvement options, and how much potential return it can provide.
When it comes to home improvements, the kitchen is king. Unsurprisingly, the kitchen tends to be where most of the activity in the house happens, and where people spend most of their waking hours while at home. In a 2004 study by Remodeling magazine, a kitchen remodel returns well over 100% in major American cities, sometimes up to 150%. Of course, there are some additional considerations to be made when it comes to the housing market in general. Within the kitchen some of the most common items of improvement include countertops, gas ranges, cabinets, and flooring.
Like the kitchen, the bathroom is another expensive area to construct and a good indicator of the build quality of a home. One popular modification these days is getting rid of a bath tub for a walk-in shower. As cities increase in density and people become busier, baths become more infrequent. Thus, a tub usually ends up being wasted space.
If you live in a home with only 1 bathroom, a great option, if space allows, is to add another bathroom. A study done at Florida State University found that an additional bathroom increased a home’s value by up to 8.7%
With all the talk of glamorous remodels of the kitchen and bathroom, it’s important not to overlook the basics. An astute buyer or realtor will notice any flaws in the basic infrastructure of a home, such as leaky pipes or old roofs. These problems with infrastructure means impending expenses at some point in the (possibly very near) future. Regardless of how great the kitchen looks, it won’t matter if the buyer will need to spend tens of thousands in a couple of years to fix the musky, leaky basement.
Some homes still come with an unfinished basement. Adding in an entire suite, although expensive, will be a great investment as the home now has additional ability to generate income. With this increased income potential, there comes an increase in the home value. This makes your home much more attractive to prospective investors.
Once you have decided on what changes and updates you want to make to your home, the next step is to consider how you want to pay for it. This discussion, however, we’ll leave for another time.