Now is actually a great time to consider a home remodeling project. According to Angie Hicks, founder of Angie’s List, the nation’s leading provider of consumer reviews on local service companies, ninety percent of the Angie’s Members responding to a January 2011 survey say they plan to spend, on average, 5 percent of their homes’ value making improvements and repairs.
Return on Investment: Home Remodeling
Now is actually a great time to consider a home remodeling project. According to Angie Hicks, founder of Angie’s List (www.angieslist.com), the nation’s leading provider of consumer reviews on local service companies, ninety percent of the Angie’s Members responding to a January 2011 survey say they plan to spend, on average, 5 percent of their homes’ value making improvements and repairs. In a separate poll of contractors rated on Angie’s List, also conducted in January, 80 percent of the home improvement specialists said they were willing to drop their prices in 2010 to get a job.
“As demand increases, contractors are going to pull back on those discounts,” Hicks predicted. “If you’re among those planning to remodel this year, don’t put it off. Not only are you risking your discount opportunity, you might find the best contractors in town are too busy to get to you.”
10 Tips to Make the Best Return on Your Remodeling Investment:
1 > Remodel vs. Add-on, the Winner is Remodel
The statistics from Remodeling Magazines 20010 – 2011 Cost vs. Value Report show that in the current market it pays to remodel or update vs. add on. Bathroom remodels recouped 64.1% of their costs while bathroom additions recouped only 53.3%. Similarly a minor kitchen remodel recouped 72.8% of its costs while the addition of a master suite only made back 63%.
2 > Open Up
Open up space by knocking down walls rather than adding square footage. As we saw above the chances of recouping your costs on an addition fall. Also, with heating and cooling costs on the rise for the foreseeable future homebuyers are looking for usable livable space rather than just high square footage. You can add the feeling of additional square footage by creating an open “great room” with your kitchen/living room/ dining room area.
3 > Invest in Quality Materials
Quality materials hold up over the years. Cheaper alternatives can show wear and tear quite quickly requiring you to replace countertops or flooring before resale if you have lived in your remodel for a few years. Well chosen stone, wood, or tile will continue to add value for years to come.
4 > Go Neutral
Those red kitchen cabinets you saw in your favorite magazine might be your dream upgrade but how will that translate for future buyers. If you are planning to sell in the foreseeable future go neutral. This will ensure your remodel doesn’t turn off future buyers that don’t share your eclectic taste. The bold touches you crave can still be made with décor that is easily taken with you to your next home.
5 > Keep in Style
Keep your remodel in line with the style of your home. This is similar to the going neutral approach. You may love the idea of a modern kitchen in your French Tudor but future buyers could be wary.
6 > In the Bath
Avoid moving fixtures if you can. Moving plumbing lines can add enormously to a projects costs and potentially lead to future headaches. Add a privacy wall around the current toilet to give some of the value of a private room while avoiding the costs of moving the waste line.
7 > Green, Green, Green
We can’t say it enough. Higher energy prices and greater environment awareness have hugely increased the demand for green home features. Anything that increases home efficiency and lowers energy and maintenance bills is a huge plus and will increase your home’s value to future buyers exponentially.
8 > Don’t Go Overboard
According to the National Association of Home Builders (NAHB) any remodeling project that brings your home’s value up to the level of your neighbors is a worthy investment. Beware though; it doesn’t necessarily pay to be the most expensive house on the block. Real estate experts recommend that a remodeling investment should not raise the value of your home to more than 10-15% above the median sales price in your neighborhood. If you do too much you could price yourself out of your current area when going to resell.
9 > Model After a Model
Potential buyers will compare your home to new homes on the market. Looking at what new home builders are doing as far as upgrades, layouts, and styles can be a great place to get ideas for your remodel. This way your remodeled home can compete with the new home market for buyers.
10 > Bridge the Generation Gap
Baby Boomers currently own the most housing stock and spend the most in the housing market but Gen Xer’s are just behind them. As Boomers age they will be doing less in the ways of home improvement and will look for homes that have already been upgraded. Gen X are looking to accommodate their growing families. Making your home remodel appealing to both groups can guarantee you the largest market of future home buyers.
And Lastly > Hire the right contractor!
All the planning in the world is for naught if you do not hire the right contractor to do the work. Angie’s List recommends you verify a contractors business license (you can do this at www.cslb.ca.gov), check references thoroughly (visit a current job site if you can), and get at least 3 different estimates in writing. Ensuring not only the finest craftsmanship but also the right design both aesthetically and functionally for your home requires a contractor with experience to make informed recommendations.