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Good Remodeling Projects for High Return

Report: Remodeling Projects that Yield the Greatest ROI


A lot of homes can use a facelift, especially properties in distress, but some projects may not be worth the sweat and dollars when considering the return on investment (ROI).

Based on results from the 2013 Remodeling Cost vs. Value Report, the National Association of Realtors (NAR) revealed exterior projects will typically yield the highest ROI.

“Projects such as siding, window and door replacements can recoup more than 70 percent of their cost at resale. Realtors know what home features are important to buyers in your area and can provide helpful insights when considering remodeling projects,” said NAR president Gary Thomas, broker-owner of Evergreen Realty in Villa Park, California.

The report found replacing a door with a steel entry door anticipates the most return, with an estimated 85.6 percent of costs recovered upon resale. On average, the report found a steel entry door replacement is costs about 1,137 on average.

However, an article from House Logic, NAR’s consumer website, warned the lifespan of a steel door is generally shorter than fiberglass or wood doors.

The project that would reap the next highest return is a wooden deck addition. The project is estimated to recoup 77.3 percent of costs upon sale, but project expenses should average $9,327.

Replacing a garage door ranked third, with 75.7 percent of costs expected to be recouped and a lower average cost of $1,496. While most of the high-ranked projects were exterior, a minor kitchen remodel is expected to yield the fourth highest return of 75.4 percent. The average cost for this project is $18,527.

Wood replacement windows were No. 5, with 73.3 percent of expenses expected to be recouped, along with an average cost of $10,708.

Other projects expected to yield at least a 70 percent return were attic bedroom (72.9 percent), vinyl siding replacement (72.9 percent), vinyl window replacement (71.2 percent), and basement remodel (70.3 percent).

In general, projects involving additions, with the exception of decks, were expected to cost the most, while the returns were not as high. Among the additions, a two-story addition ranked the highest, but costs an average of $152,470 and yields a return of 65.4 percent.

Home office remodel (43.6 percent) and sunroom addition (46.5 percent) are expected to recoup the smallest return.

However, before tackling a project based on the report, Thomas advised consulting a Realtor to decide what improvement projects will provide the most upon resale in a homeowner’s specific market.

“Each neighborhood is different, and the desirability and resale value of a particular remodeling project varies depending on where you live. When making a home remodeling decision, resale value is just one factor that homeowners should take into consideration,” he added.

The report is completed in cooperation with NAR and compares construction costs with resale values for 35 midrange and upscale remodeling projects in 81 markets across the country.