Remodeling with a return on investment in mind can be a smart strategy for homeowners, whether one is thinking about moving in the next few months or further down the road. Though this approach is an inexact science, in many instances, it’s savvy for homeowners to consider what buyers may want when planning home improvements.
Homeowners may be surprised to learn which renovations garner the best ROI at resale. The home loan and refinancing company RenoFi indicates that overall home improvement projects provide a 70 percent ROI on average. Many high-ROI projects add functional space and improvement. The following are some exterior renovations that help homeowners recoup the most money at resale, according to Remodeling magazine’s “2022 Cost vs. Value Report.”
1. Garage Door Replacement: 93.3 percent recouped of $4,041 cost
2. Manufactured Stone Veneer: 91.4 percent recouped of $11,066 cost
3. Siding replacement (Fiber Cement): 68.3 percent recouped of $22,093 cost
4. Window replacement (Vinyl): 67.5 percent recouped of $20,482 cost
5. Siding replacement (Vinyl): 67.2 percent recouped of $18,662 cost
6. Window replacement (Wood): 66.3 percent recouped of $24,388 cost
7. Deck addition (Wood): 64.8 percent recouped of $19,248 cost
8. Entry Door Replacement (Steel): 63.8 percent recouped of $2,206 cost
The majority of renovations on Remodeling magazine’s list of the best investments are exterior renovations, making this area of a home a particular point of interest for homeowners. The only interior project that cracked the Top 10 ROI for projects was a minor midrange kitchen remodel.
Exterior renovations perhaps add the most bang for your buck because they’re not only functional, but also because they add immediate curb appeal. Much in the way it has been said people eat with their eyes first — which is why chefs spend so much time on elaborate plating — buyers will judge a property by how it looks when they arrive, even before they’ve stepped inside a home. In essence, home buyers often judge a book by its cover. A worn exterior may indicate to potential buyers that the home was not maintained, however false that assumption may be.
It’s important for homeowners to consider all factors before beginning a renovation. Certain projects offer a stronger return on investment than others, and that’s a significant consideration for homeowners thinking of selling their homes.