Home improvement is a common way to add value and improve your home’s look. However, many homeowners get carried away with their home improvement projects and spend more than they’ll actually get back when they sell the house. Before you rip out your bathroom or start hanging wallpaper, think about what kind of renovations will really boost your home’s value and which ones might even detract from it.
Many people renovate their homes to increase the resale value and make the property more attractive to buyers, but the best home improvements are those that will also enhance the residents’ quality of life. Depending on what you choose, some updates may even be tax deductible.
When selecting a home improvement project, consider its impact on your lifestyle and how it will affect your monthly budget. If you can’t afford to pay for a major renovation right away, it may be worthwhile to consider a personal loan, a line of credit or a home equity loan. The length of time for which you’ll repay the loan depends on what type of loan you choose, with personal loans typically offering a shorter repayment term than those that are backed by your mortgage.
The most popular home improvement projects are sparkling bathroom overhauls, followed by kitchen and basement remodeling. However, these projects can have a relatively low ROI at 60 percent or less, according to data from Contractor Growth Network and Zonda Media. Instead, focus on those home renovations that will provide a high return on investment, such as energy-saving appliances, new windows and smart thermostats.
In addition to making your home more appealing to prospective buyers, some home renovations can also help you save on utility bills. Replacing old windows with high-efficiency models, for example, can result in a 68 percent ROI. A smart thermostat that adjusts automatically and helps you control your home’s energy usage, on the other hand, can deliver a whopping 82 percent ROI.
On the flip side, some home renovations may actually detract from your home’s resale value by turning off potential buyers. For instance, an in-house theater is likely to turn off most people who aren’t movie buffs, and built-in electronics that can’t be removed are also a turnoff.
A well-maintained lawn and yard are also important for boosting your home’s curb appeal. For this reason, try to avoid trees that drop a lot of leaves in fall, such as oak, female ginkgo biloba, sweet gum and locust trees, which can decrease your home’s curb appeal and lead to a messy yard. In lieu of these messy trees, try a crepe myrtle or Colorado blue spruce. Likewise, avoid overly ornamental, invasive plants such as oleander and Japanese magnolia.