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Before I get started I wanted to share that I was featured on The Mastermind Within’s podcast this week where I talk about paying off my mortgage in 7 years. Check it out if you get a chance. Now back to the regularly scheduled post!
My wife and I plan to move in the near future. Whether that is overseas or slightly closer to work, I’m not sure. However, as we prepare to move, we are trying to spruce up our home to make it more appealing when it comes time to sell.
Home Improvement Projects
This past weekend, my Dad came over to help me work on some projects. I don’t think too many people would sacrifice their weekend golf to do home improvement projects. Thankfully, my Dad is very kind and very handy. He can fix anything. Unfortunately, while I am willing to fix things, I am much less handy. So it’s nice to have someone look over my shoulder and work alongside me to ensure that I don’t make any costly mistakes.
Over two days, my Dad helped me install a Moen kitchen sink faucet and a Crystorama chandelier in the dining room. Fancy, huh? Honestly, I didn’t really see the need for either at first. It was my wife who insisted on the changes. However, I’m glad we swapped our old items out for these though because both totally transform the spaces. Who knew that a faucet could make such a big impact in a kitchen? And of course, a crystal chandelier screams bling, and my wife is in love. Side note– we were able to use Ebates for both of these purchases and got quite a bit of cash back. It’s always nice to save any extra money you can when buying these type of products. They aren’t cheap!
Admittedly, I thought both of these projects would be straightforward. My Dad had recently helped install the same exact faucet with his neighbor, and I figured a chandelier couldn’t be that hard. Well, I wanted to pull out my hair at certain points during both projects. I assumed each project would take an hour or two to complete. In actuality, each one took us the better half of a day.
I could get into the nitty gritty of why both projects took so long, but I’ll spare you the details. Basically the plumber who installed our first faucet did a sloppy job, causing us to address some of those issues during the installation of our new faucet. With the chandelier, I really struggled with opening and removing the chain links from the chandelier’s rope. I felt like I needed to be the Incredible Hulk to pull them apart.
Was It Worth It?
While it took longer than expected, both projects are complete (phew!). More importantly, my wife is so happy. While it took the better part of two days since we did the work ourselves, I did wonder: how do we know which upgrades will provide the biggest return on investment?
Recently, I stumbled upon a great resource called Remodeling Magazine, which published their annual Cost vs. Value roundup. In it, they provide the average cost of the home project along with the average recouped value for the 20 most common home upgrades across 149 major real estate markets across the U.S.
Top 20 Projects
|PROJECT||JOB COST||RESALE VALUE||COST RECOUPED|
|Garage Door Replacement||$3,470||$3,411||98.30%|
|Manufactured Stone Veneer||$8,221||$7,986||97.10%|
|Deck Addition (Wood)||$10,950||$9,065||82.80%|
|Minor Kitchen Remodel||$21,198||$17,193||81.10%|
|Window Replacement (Vinyl)||$15,955||$11,855||74.30%|
|Universal Design Bathroom||$16,393||$11,581||70.60%|
|Window Replacement (Wood)||$19,391||$13,468||69.50%|
|Grand Entrance (Fiberglass)||$8,591||$5,809||67.60%|
|Deck Addition (Composite)||$17,668||$11,239||63.60%|
|Major Kitchen Remodel||$63,829||$37,637||59.00%|
|Master Suite Addition||$123,420||$69,807||56.60%|
|Major Kitchen Remodel||$125,721||$67,212||53.50%|
|Master Suite Addition||$256,229||$123,797||48.30%|
Source: Remodeling Magazine
One of the more interesting takeaways from the list above, is that 8 of the top 12 projects are exterior projects, which reap the greatest financial benefits.
I couldn’t believe that garage doors had the highest resale value, with manufactured stone veneer shortly behind. There is a widespread belief that kitchens and bathrooms help sell a house. However, at resale returns of 59% and 56.2%, those may not necessarily bring back the dollar-for-dollar investment that you put into them.
Why do exterior projects provide the biggest return on investment? It’s simple. It has to do with the home’s curb appeal. If the home doesn’t look good from the outside, chances are that potential buyers won’t want to venture inside.
When my wife and I look at houses on Redfin, we definitely shy away from homes with deteriorating exteriors. Our thought process is, if they don’t take care of the exterior, why would we assume that they take care of the interior?
Remodeling Magazine also broke down the number of markets in which projects provided returns of over 100%.
|Garage Door Replacement||46|
|Manufactured Stone Veneer||44|
|Deck Addition (Wood)||13|
|Minor Kitchen Remodel||12|
Source: Remodeling Magazine
Once again, no surprise that exteriors provided the biggest bang for the buck. Meanwhile, minor kitchen remodels made this top 5 list. Interestingly enough, a major kitchen remodel and upscale suite addition did not provide a 100% payback in any real estate market. So before you undertake these type of projects, make sure you understand this.
On top of that, the average payback for the 20 most common professional remodel projects dropped slightly from 57.9% in 2016 to 56.8% in 2017. This is mainly due to the fact that the cost of doing these type of projects went up, while the home values only rose for 2/3 of them.
Do you wonder why the costs went up? It is the due to the overwhelming demand that arose in the U.S. due to the devastating hurricanes and wildfires last year.
The experts also believe that costs will rise again this year by 3-5%, depending on which market you live in. So, if you’re in the market for a remodel, don’t be shocked by the potential increase.
My Personal Thoughts
Considering the info above, I’m not sure changing out our kitchen faucet or chandelier will give us a great return on our money. I’m not mad about spending that money though. My wife is happy, and hopefully those touches will show potential buyers that we have taken care of our home.