Home Remodeling Projects: Best Bets vs Foolish Flops

By Ryan Dosen

 

When it comes to home improvements, all projects are not created equally—especially when you consider your projected return-on-investment.

Spring is the time of year when many of us will consider either moving or improving our existing home. To help guide us in the wise disposition of our precious dollars, Remodeling Magazine just released its “2015 Cost vs Value Report.” The Report “compares average cost for 36 popular remodeling projects with the value those projects retain at resale in 102 markets.” Some projects will return 80 percent or more of your initial investment; other projects may not even return half of your investment. To help clear the fog, let’s take a look at the best and worst return-on-investment home remodeling projects.

Best Bet: Entry Door Replacement (Steel)

Remodeling Magazine’s highest rated return-on-investment home improvement was the replacement of your entry door with a new 20-gauge steel unit, including clear dual-pan half-glass panel, jambs, and aluminum threshold with composite stop. This was the only project that actually was estimated to return more than the initial investment (cost recouped: 101.8 percent). The average job cost for this project was listed at $1,230.

Foolish Flop: Sunroom Addition

The lowest return-on-investment project analyzed by Remodeling Magazine was the addition of a sunroom. The addition of a sunroom, estimated to cost around $75,000, was priced out assuming the construction of a 200-square-foot build-out with 10 large aluminum-clad venting skylights and movable shades. Netting only a 48.5 percent return-on-investment, this renovation would only be expected to increase your home’s value by around $36,000.

Best Bet: Manufactured Stone Veneer

The addition of a manufactured stone veneer can do wonders for the appearance of your home. Few things can transform and enhance your home’s curb appeal like adding a stone veneer to a previously bare wall. Manufactured stone also offers the look and feel of quarried stone, at a fraction of its price and installation time.

For their survey, Remodeling Magazine examined the cost and return  of “replacing 300 square feet of vinyl siding from the bottom third of a house with manufactured stone veneer, two separate layers of water-resistive barrier laid over bare sheathing, corrosion-resistant lath and fasteners, and a nominal ½-inch-thick mortar scratch coat and setting bed.” This project, costing an average of around $7,000, classes up your home and is said to net you an average return of 92.2 percent.

Foolish Flop: Home Office Remodel

If you choose to remodel your home office, the experts say that you’re only going to see about a 49 percent return on your investment. Remodeling Magazine priced out the cost of converting an existing 12×12 room into a home office, complete with custom cabinets, 20 linear feet of desktop, a computer workstation, wall cabinets, wiring, and carpeting. The cost of the project was estimated at around $29,000; it was only estimated to bring a return of around $14,000.

The thinking here is perhaps that homes are typically marketed as having a certain number of bedrooms. In buyers’ eyes, there may be little difference between a home that is presented with 3 bedrooms and a home that is presented with 2 bedrooms and a home office. Custom office build-outs may not add much value to your home because the market will just view the office as another bedroom.

Remodel Right or Move

Of the 36 home remodeling projects examined, only 7 were estimated to bring a return-on-investment of at least 80 percent. We’ve said it before, and we’ll say it again: If you’re thinking about listing your house this year, think twice about doing any significant renovations. You’ll rarely get you money back. If you like where you’re living and you want to stay, be sure that you’re spending your money on projects that will net you a decent return. Pass on that sunroom. Or sell now and buy a home that has one.

This article was published by 21st Century Media and the Daily Local News (West Chester, PA). To read this article on the the newspaper’s site, please visit the Daily Local News.

 

 

To view all of Ryan Dosen’s 21st Century Media real estate columns, visit http://www.dailylocal.com/search?text=dosen.