WASHINGTON — The conventional wisdom has it that renovating your home will
pay off in the end with a higher resale value. But that’s not always true, a
new study says.
Bankrate.com reports on a study by Remodeling magazine,
which looked at 35 renovation projects and found out how much of the costs
homeowners will get back at resale time.
The study found that most of the 35 projects didn’t recoup their costs at
resale, and the six lowest-value projects that Bankrate listed returned 61
cents on the dollar — or less.
The worst home renovation project as far as resale value? A home office. The
report says that a good home office requires some serious rewiring and new
walls.
It can cost serious money, ($28,000) and realtor Ron Phipps tells Bankrate
that it won’t get future buyers psyched the way a home theater or new kitchen
might. The return on the investment at resale is 48.9 percent.
Other renovations that may not add up at resale time: sunrooms, upscale master
suites, upscale garages and bathroom additions.
The lesson? If you’re going to renovate, do it because you want the
renovations and because you’ll like the end result. But don’t expect to make
money on the deal.
Remodeling magazine breaks down the costs of renovations and their resale
values in its Cost
vs. Value report.
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