It's not much of a stretch to say that residential remodeling has become America's obsession. According to a recent study, 1 in 10 homeowners spends more than $5,000 annually on remodeling their house. That's $150 billion a year on residential remodeling.
Before you shell out $5,000 on a bathroom or kitchen remodel, make sure you're doing it for the right reasons. If you're not planning on moving for 10 years or more, remodel for your own pleasure, say industry experts. But if you want to add value to your home for resale, be more selective with a bathroom or kitchen remodel.
Guidelines for making your remodeling project payoff. According to home remodeling experts, the hottest residential remodeling projects include kitchens, baths, siding and window replacement. The key to any successful remodel project is quality work, regardless of what it is, experts agree.
Don't make the expensive mistake of starting a remodeling project that isn't going to add value to your home. A kitchen remodel is one of the top five most popular remodels in America right now, but a $20,000 kitchen remodel isn't necessarily going to help sell a manufactured home.
An outdated kitchen will be the first thing that turns off a prospective buyer. A minor kitchen remodeling project is going to cost, on average, nearly $15,000, according to one source, which equates into a 88 percent return on investment.
Fixing up a tired bathroom will really wow prospective home buyers. And it will add 81 percent on your return if the house is sold in one year from the time the work is completed. Not bad!
Assessing property in your neighborhood. Before you start in on a residential remodeling project, sniff around the neighborhood to find the best remodeling investments, and to find out what may be considered a reasonable improvement and whether the buyer's market would approve.
Keep track of what homes are selling for in your neighborhood. Keep your home's value just below the higher end homes in your area to be safe. Talk to an experienced REALTOR and visit open houses too.
How much do you have to spend before you see a return on your investment? Many people see thousands of dollar signs when they think of a residential remodeling project, but sometimes it's the little improvements that will escalate your home's resale value. According to one source, 70 percent of remodeling dollars go to improvements such as additions or major remodels, but the other 30 percent pays for maintenance and repair, such as painting or re-roofing.
According to another survey, you'll see a 594 percent return on your home if you declutter and clean it before putting it on the market, which equates to a $2,000 return on something that took a little elbow grease and about $300. Other inexpensive remodeling projects for your house include fresh paint, carpeting, and some exterior cleanup.
Depending on how much money you have to spend on a residential remodeling project, you're bound to improve the price of your property regardless if you decide on a $20,000 kitchen remodel or spend a few weekends painting and replacing light bulbs.