Home Improvement Costs and Returns - Blog - Northshorist

Adding value to your home ? Determining the return

What kind of value can you expect form a home improvement project? Well that depends on what type of value you expect.

Of course there is the obvious functional value. A new roof and/or new siding will protect your home, your investment, from potential damage. A new addition may be essential for an expanding family. Functional value is incredibly important but sometimes a monetary return is the desired objective, especially for homeowners looking to move in the near future.

The monetary return from a home improvement project can be a tricky subject. Every year Remodeling Magazine issues a Cost vs. Value report. For this year?s report focusing on the Boston area click here.

An easy indicator of what is and is not a worthwhile project is the cost recouped percentage. A sunroom or home office remodel, which recoup 46.5% and 43.6% respectively, immediately present themselves as a bad idea. Now the functional value of a sunroom or revamped office might completely outweigh that loss but that can only be considered on an individual basis.

Another important number to consider is the difference between job cost and resale value. Large renovations can have an artificially high recoup percentage. For example the cost recouped for a basement remodel is 70.3% although in real dollars the value gained is $18,208 less than the project?s cost. An additional bathroom only recoups 54.8% but in real dollars you are only down $16,932 less in value from what you spent.

Also be smart. If the neighborhood is mostly two bedroom, one bathroom ranches built in the 1950?s a Sub-Zero refrigerator and a custom steam shower probably isn?t the best idea from a cost recouped point of view.

When beginning a home project take a look at the numbers from Remodeling Magazine, talk to a local Realtor about the potential after market value, educate yourself on the available tax credits for going green, and remember buyers will be most attracted by basic maintenance (roof, siding, heating, etc).

Photo by Kim Piper Werker

We are Essex County real estate specialists centered in Beverly. Our group has over thirty-five years of collective experience dealing in Massachusetts property. If you would like to schedule a buyer or seller consultation please feel free to call our office at (978) 524-8725 or leave us a message here.

The Northshorist Group offers so much more than just real estate expertise. We spend the time to learn about expectations and lifestyle. Combining that with a strong focus on the buyer or seller?s best interest creates an incomparable experience. Most importantly we are longtime residents of, and love, the North Shore. Click to browse waterfront properties, luxury homes, foreclosures, short sales, multi-families, or make your own search.

Source: http://blog.northshorist.com/2013/02/06/home-improvement-costs-and-returns/

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