Remodels Don’t Always Pay
Modern wisdom holds that bathroom and kitchen remodels are great ways to invest in a home’s resale value. Where this belief comes from – whether it’s all those HGTV shows or news of successful “house-flippers” – isn’t as important as the fact that it generally isn’t true – and recent data proves it.
The fact is that if you’re expecting to recoup the cost of your remodel at resale, you’re likely to be sorely disappointed. While bathrooms and kitchens are key components of any successful home sale, remodeling them isn’t always financially wise. Things like location, market trends, and resource costs can all impact how much a remodel costs you and how much you can expect to recoup at resale.
The Cost Vs. Value of Remodeling in Cincinnati
In Remodeling Magazine’s 2016-2017 Cost vs. Value Report, data for Cincinnati, Ohio reveals that the average cost recouped during resale for a remodel was 67.1%. Some projects recoup their costs better than others; bathroom additions, for example, recouped an average of 61.4% while bathroom remodels recouped about 55%. Just 6 years ago, those numbers were reversed. The extent, location and even timing of your remodel can affect your resale value.
To effectively determine the value of a large home improvement project, Cincinnati homeowners have a lot to consider. Owners planning to make full use of a remodeled room will get far more value out of it than someone looking to quickly “flip” a home. But unless you intend on spending the rest of your days in the same home, remodels should be partly viewed through the lens of resale value.
Just as buying a car known for its value retention is a good investment, investing in a home remodel that recoups its costs is wise. Reading a single report on the subject doesn’t equip a homeowner with perfect knowledge, but it enables them to make a more informed decision that can wind up saving them thousands of dollars. All of the following information is from Remodeling Magazine’s 2016-2017 Cost vs. Value Report.
Top 5 Best & Worst Remodels for Resale Value in Cincinnati
5 Best Mid-range Projects
5 Worst Mid-range Projects
1) Manufactured Stone Veneer
$7,876 Avg. Spend
80.3% of Cost Recouped
2) Basement Remodel
$70,400 Avg. Spend
58% of Cost Recouped
3) Attic Insulation (Fiberglass)
$1,384 Avg. Spend
73% of Cost Recouped
5) Family Room Addition
$89,211 Avg. Spend
64.3% of Cost Recouped
5 Best Upscale Projects
5 Worst Upscale Projects
1) Garage Door Replacement
$3,377 Avg. Spend
74% of Cost Recouped
1) Master Suite Addition
$248,349 Avg. Spend
56.8% of Cost Recouped
2) Vinyl Window Replacement
$15,267 Avg. Spend
71.6% of Cost Recouped
2) Composite Deck Addition
$39,286 Avg. Spend
61.3% of Cost Recouped
3) Major Kitchen Remodel
$123,675 Avg. Spend
70.5% of Cost Recouped
3) Bathroom Remodel
$60,276 Avg. Spend
62.9% of Cost Recouped
4) Grand Entrance (Fiberglass)
$8,366 Avg. Spend
70.3% of Cost Recouped
4) Bathroom Addition
$80,454 Avg. Spend
63.4% of Cost Recouped
5) Bathroom Redesign (Universal)
$15,356 Avg. Spend
70.2% of Cost Recouped
5) Wood Window Replacement
$18,767 Avg. Spend
67.7% of Cost Recouped
Does Remodeling Increase Resale Value?
Yes, but the increase is rarely in proportion to the cost of the remodel. Small repairs are typically more cost-effective. If you are planning on putting your home on the market, even the National Association of Realtors recommends that you “spend as little money as possible.” Instead, they recommend that homeowners “focus on minor and inexpensive ‘polishes’ and ‘touch-ups.'”
Here are 4 great touch-up ideas for the bathroom:
- Bathroom Plumbing: Inspect and repair plumbing lines and fittings. Replace the toilet, lavatory faucet and shower head to give the bathroom a “new, clean feel” for as little as $1000.
- Bathroom Walls: Repair cracks in the drywall and paint the room in a neutral color. Wall repairs along with a fresh coat of paint can cost as little as $500 and can eliminate stains or mold growth and make the room appear and smell like new.
- Bath Fixtures: Matching towel racks, paper dispenser and light fixture provide a consistent and modern décor to the bathroom. High quality, attractive fixtures may often be purchased and installed for under $500.
- Bathroom Tile: Replace linoleum or worn wood flooring with a neutral-colored ceramic tile. An average-sized bathroom can have tile installed for under $1,500.
Combined, making these improvements before an open house can make a world of difference. Notice that none of the above recommendations call for a full remodel and instead ensure improving the interior appeal of your home to potential buyers. Any capable do-it-yourselfer can even While the national average cost for a bathroom remodel is about $18,500, a typical bathroom update with repairs like those described above can cost as little as $3,500. Both options can help get a home sold, but one – a bathroom update – offers a much higher return on investment than the other.
Mid-range Vs. Upscale Remodels in Cincinnati
On average, mid-range remodels recouped slightly more of their costs than upscale remodels in Cincinnati. Mid-range came in at around 67.3% recouped costs while upscale was about 66.9%. The difference is almost negligible, but given the inherent high cost of an upscale remodel, even half a percentage can represent thousands of dollars – dollars that a homeowner would no doubt prefer stay in their pocket.
That being said, not all mid-range remodels fared better at resale than upscale remodels. Bathroom remodels again provide an excellent example: upscale bathroom remodels in Cincinnati recouped almost 63% of their costs while mid-range bathroom remodels only returned about 55%.
The most important difference between mid-range and upscale remodels, besides cost, is the purpose behind the remodel. The reason a homeowner might be willing to pay twice as much for a remodel is because those costs are offset by the advantages and improvements to standard-of-living that a remodel can provide. Turning a child’s room into an office, for instance, may not positively affect a home’s resale value but instead simplifies the homeowner’s day -to-day and improves his or her lifestyle.
Whatever you decide as a homeowner know that money isn’t everything. Each homeowner’s situation and preferences are different; a remodel that may make sense for one won’t necessarily be a good idea for another. The important thing is to inform yourself as a homeowner and make the best decision to increase you and your family’s standard-of-living.
Let ProMaster Complete My Remodel
Once you’ve decided that a remodel is for you, why not hire an ethical and on-time craftsmen to complete it for you? For $79 you can invite a professional craftsman – not a subcontractor or salesman – to look over and evaluate your entire project or projects, providing options, ideas and costs. You don’t have to worry about the caliber of person your letting into your home; our craftsmen are extensively background-checked and drug-tested, and you’ll receive a bio, picture, and phone number to the craftsman you’ll be meeting before they ever set foot on your property.
Call (513) 322-2914 today and schedule a Home Repair Hero to complete your remodel project!