Most people understand that adding a new room or upgrading a kitchen or bathroom adds value to their property. But is it always worth the expenditure, especially if there is no other overriding requirement, and how much of the cost can you expect to recoup when you decide to sell? And this year, what impact does the change in the market have on the benefits of remodeling?
Remodeling magazine's annual 2007 Cost vs. Value Report, prepared in cooperation with Realtor Magazine, compared construction costs with resale values for 29 common remodeling projects in 65 U.S. markets, to determine the return on investment.
Click here for the report summary published in REALTOR® Magazine
According to Realtor Magazine, "Home rehabbers who are considering a move in the not-too-distant future should focus mostly on exterior upgrades.
Of projects that saw national cost recovery rates of more than 80 percent in 2007, only one - a minor kitchen remodel, with 83 percent of cost recovered - was a strictly interior job. The others were an upscale siding replacement using fiber cement materials (88.1 percent), a wood deck addition (85.4 percent), midrange vinyl siding replacement (83.2 percent), and upscale vinyl and midrange wood window replacements (81 percent and 81.2 percent, respectively).
On most projects, the value of remodeling trended down in 2007 compared with 2006. No project exceeded an 88 percent return. The likely culprits for the year-to-year drop: rising remodeling costs and slowing home appreciation brought on by the lackluster housing market in many areas."
"Nationally, projects at the bottom of the cost-recovery ladder included home office remodels (57 percent), installing a back-up power generator (58 percent), and adding a mid-range sunroom (59.1 percent)."
See prior blog article for 2006 Cost vs. Value Reporting
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Copyright 2007 by Lawrence Yerkes. All Rights Reserved.
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