With the warm-weather months upon us, many homeowner's thoughts are turning to home improvement projects. Whether the goal is to create an urban oasis that caters to your specific lifestyle or to boost your future sales price, a smart first step is arming yourself with potential costs and returns. That's where the Remodeling Magazine's Cost vs. Value Report comes in.
This useful annual survey breaks down estimated job costs, resale value and dollars recouped for 22 popular renovation projects, both indoors and out. Providing data at the national, regional and metropolitan level, the report is an excellent resource for those who want the most bang for their renovation buck.
One finding that has remained consistent in the Cost vs. Value report year after year is the higher rate of return for "midrange" quality finishes versus "upscale" finishes — say ceramic tile versus premium stone. And while that holds true for in this year's findings as well, luxury finishes are gaining. "Year-over-year changes in the percentage of costs recouped from upscale projects have increased at a greater rate, suggesting that buyers of existing homes are willing to invest a little more for opulence these days," the report explains.
Interestingly, the total percentage of value earned at resale for all 22 projects list is nearly identical at the New York City and national data levels: New York sees a 68 percent return compared to the national average of 68.6 percent. Even though material and labor costs spike much higher here (27.5 percent higher, in fact), the resale values also run significantly higher (26.5 percent) than the national average.
Let's take a closer look at a few more takeaways for renovating costs and returns in the New York area:
In townhouses and other single-family homes, façade updates return a tremendous amount of value. In fact, projects such as updating garage doors, upgrading entryways, and adding new siding or stone to the façade place among the top projects on the Cost vs. Value report, returning between 96.5 percent and 80.9 percent of their costs. Those results certainly make improving curb appeal very appealing indeed!
Providing both style points and energy savings, windows are another remodeling investment with high ROI. With our wide range of temperatures, from chilly winters to hot summers, new windows have the added incentive of improving heating and cooling efficiency year-round, not to mention the added tranquility that comes from employing "city quiet" varieties.
Deck additions make good sense for those wishing to maximize both outdoor space and ROI. The Cost vs. Value report indicates a 67.5 percent return on an $18,000 wood deck addition and a 64.7 percent return for a $25,000 deck using composite materials.
While most people dream of the kind of oversized, lavish bathrooms that are often hard to find in New York City, the Cost vs. Value report for our area posts rather meager resale ROI for bathroom remodels, running between 51.9 percent to 55.8 percent. "There is no one best cabinet style or color, no perfect tile or fixture design, that garners universal affinity," explains the report. "Certainly, there are design trends that have wide appeal among a range of homeowners. But because of the vast differences in aesthetic tastes, one person's elegant new kitchen or bath will be viewed by a range of other prospective buyers as tacky and outdated and in desperate need of a reset."
While the type of data found in the Cost vs. Value report can provide an excellent guide in your home renovation endeavors, it's impossible to take into consideration the numerous other factors that can impact sales price, including comparable sales listings, individual neighborhood variations and buyer tastes. And, at the end of the day, enjoying a fantastic chef's kitchen or luxury bathroom for the duration of your ownership may be worth far more to you than any incremental increase in sales price years from now.