Getting a sense of the value of your renovations and how they affect the resale value of your home can mean the difference between making a profit and floundering under sunk costs. These values shift over time, depending on what is more important to consumers in a given year. A type of project that turned a major profit one year might be a complete waste of time and money in the next. Some projects might influence a home’s value more in one home compared to another, perhaps because that part of one home had fallen into disrepair. This is where your judgment on the individual situation is crucial to your success, and it is important to find out how much value you are adding to your unique project.
The following lists offer good general guidelines over what we believe consists of high, moderate and low-value projects for most home remodelling projects, based on the market as it stands this year.
When looking for high-value remodelling projects, you want to find simple projects that pack a hard punch when a potential buyer comes to visit. A focus on appearance is key here, where external projects like garage door replacements, fibre-cement siding replacements, and manufactured veneer stone can make a high-value impact at a relatively lower cost. The kitchen also tends to be the most important room to many homebuyers, and a mid-range kitchen remodel can be a very good contender for either breaking even or drawing a profit.
Although these types of remodelling projects are often predicted to be high-value, there are some markets where they may be less desirable. Do your research and stick to your budget, and you should come out of your projects ahead.
Moderate Value Projects
These types of projects are good break-even renovations for your home. They usually don’t directly impact the selling price as they are less visible than some of their high-value counterparts, but may be considered just before selling a home if the items being replaced are seriously impacting the aesthetics for buying purposes. Generally, they are still worthwhile investments if you plan on selling your home at a later date.
Replacing items like vinyl siding, wood or vinyl windows, entry doors, and metal or composite roofs are functional candidates to hold their value and reap the benefits of saving energy costs while living in your home. A wood or composite deck and a mid-range bathroom remodel also make good break-even investments, as they tend to be luxurious but functional features.
One should only take on low-value projects should you wish to have them for yourself, and not for the ultimate sale of the home. These are the projects that you should expect to have a low probability of return on investment should you choose to undertake them. The amount of capital required to complete these projects makes them unlikely to draw willing home buyers, as most will be happy to settle for a functional counterpart somewhere else.
Depending on the market, the same mid-range kitchen remodel might prove to be too much of a cost to be worth the trouble, as kitchens can very quickly run away with expenses. Adding a mid-range bathroom or an upscale remodel of an existing one tends to fall in this category as well.
If you’re looking for home renovations, architects, or home builders in Toronto, Richmond Hill or Vaughan, Georgio Lolos and the HiLife Builders Corporation can help turn your dreams into a reality. Contact us to get started on your next project today.