Are you planning home improvements but want to ensure your investment pays off? According to the National Association of REALTORS® (NAR) Remodeling Impact Report, some projects not only improve your home’s enjoyment, but also enhance its value for resale. Here are the standout projects that deliver the best ROI.
1. Refinishing Hardwood Floors (147% ROI)
Refinishing existing hardwood floors tops the list with a 147% return on investment. With an estimated cost of $3,400 and a resale value of $5,000, this project is a cost-effective way to upgrade your home’s interior.
2. Installing New Wood Flooring (118% ROI)
Instead of refinishing, installing new wood floors is another high-return project, with a 118% return on investment. With a $5,500 investment yielding an estimated $6,500 in resale value, this upgrade is ideal for homes lacking hardwood or those with dated flooring.
3. Insulation Upgrade (100% ROI)
Improving your home’s insulation not only cuts energy costs but also offers a 100% ROI. The average cost is $2,500, making your home more energy-efficient, which can be a huge benefit to climate-conscious buyers.
4. Basement Conversion to Living Area (86% ROI)
Converting a basement into a living area is a valuable way to add usable square footage. While the upfront cost is higher—about $57,500—homeowners can recover 86% of the cost at resale.
5. Closet Renovation (83% ROI)
A functional and organized closet can make a big impact on homebuyers. A $6,000 investment in a closet renovation can return 83% of the cost, with homeowners reporting better organization and improved livability.
6. Attic Conversion to Living Area (75% ROI)
An attic conversion is a major project that can transform unused space into a bedroom, office, or playroom. With an average cost of $100,000 and a resale value of $75,000, this project offers a 75% ROI.
7. Complete Kitchen Renovation (75% ROI)
A complete kitchen renovation provides significant value to homeowners and buyers alike. Although it comes with a higher price tag of $80,000, it yields 75% of the cost at resale.
Other High-ROI Projects
- Adding a New Bathroom: A new bathroom costs about $80,000 but offers a 63% cost recovery rate. While the monetary return is moderate, the added convenience is a major selling point.
- Paint Entire Interior: Painting your home’s interior delivers high emotional satisfaction, and it’s a relatively low-cost upgrade.
What Do These Projects Have in Common?
The most successful projects have these key features:
- Livability: Buyers prioritize homes with better functionality, comfort, and aesthetics.
- Durability: Features like hardwood floors and insulation upgrades appeal due to their long-lasting benefits.
- Likability: Simple but impactful updates, such as fresh paint or modern flooring, attract a wider pool of buyers.
Not every home improvement project guarantees a high ROI, but focusing on upgrades like refinishing hardwood floors, adding living space, and upgrading insulation ensures your investment is worthwhile. These projects improve both your quality of life and the value of your home when it’s time to sell.
This article is based on data from the 2022 Remodeling Impact Report by the National Association of REALTORS®and the National Association of the Remodeling Industry (NARI).
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The Allison Ziefert Real Estate Group is a top producing real estate team based at Compass in Short Hills, New Jersey. We are local market experts, specializing in real estate and homes in Maplewood, South Orange, Millburn/Short Hills, Montclair/Glen Ridge, West Orange, Morristown and the surrounding New Jersey towns. We’ve also got you covered coast to coast with the best connections to top agents around the country in any market you are exploring. We are driven by earning great testimonials and referral business from happy clients.