Remodeling Pays Off Big Time: 2013-14 Cost vs. Value
Home improvement projects across the board are giving home owners a greater return on their investment when it comes time to sell. Find out which projects “open the door” to buyers and where remodeling dollars stretch the furthest.
As existing-home sales and home prices make remarkable strides upward nationwide, remodeling projects are also continuing to make a comeback in a big way.
This is the second year in a row that all 35 projects in Remodelingmagazine’s Cost vs. Value Report saw more home improvement dollars recouped upon resale of a home than the previous year.
Existing-home sales reached 5.02 million in 2013, a 9.1 percent increase from 2012, according to the National Association of REALTORS®. Home prices also rose in 2013: Existing homes commanded a median price of $197,100, up 11.5 percent from the 2012 median price of $176,800. This is the largest price gain since 2005.
Also for 2013, the cost-value ratio of remodeling projects nationwide averaged 66.1 percent, up 5.5 points over the previous year — which is, like median price, the largest increase since 2005.
Remodels That Payoff
The fan favorite in the 16th annual Cost vs. Value Report, which was released this month, was again the steel door entryway. Topping the list last year as well, this project is ideal for clients considering a quick update to the curb appeal of a home. The survey shows that a new steel door, with an average cost of $1,162, will recoup 96.6 percent of the remodeling cost at resale.
Making the biggest gain in percentage of recouped costs was the addition of a backup power generator. This project, averaging $11,742, jumped 28 percent in estimated resale value, recouping 67.5 percent of its cost in 2013. Usually at the bottom of the list, this project now ranks 25th out of the 35 projects. The increase is attributed in the report to 2013’s “unpredictable weather and multiple large storms.”
If your clients are considering a home improvement project to boost the quality and appeal of their home, pass on this list of top 10 midrange and upscale projects from the 2013-14 Cost vs. Value Report:
The data used in the Cost vs. Value Report was collected with the help of REALTOR® Magazine in an online survey between August and October 2013. More than 4,500 NAR members participated from 101 U.S. cities, up from 81 cities included in last year’s survey.
Visit www.costvsvalue.com to find information from the 101 cities included in the survey and download free PDFs that include specific metro-area market data. (Site registration is required.) Also visit HouseLogic.com for a slide show of the report’s results.
Construction cost estimates were generated by RemodelMAX. Cost vs. Value is a registered trademark of Hanley Wood, LLC.