Considering any home improvement projects this spring, like renovating your kitchen or bath? It’s worth looking at some data first. In today’s marketplace, you may not fully recoup your remodeling costs at resale time.
For a bathroom remodel, a homeowner can expect to recoup about 70 percent of the cost upon resale, while a major kitchen remodel could return 67.8 percent of the cost, according to the Remodeling 2015 Cost vs. Value Report, which compares the average cost of 36 types of remodeling projects with the value retained at resale in 102 U.S. markets.
The survey found that a midrange bathroom remodel costing $16,724 would only add $11,707 to the resale value of a home in today’s market. Meanwhile, a midrange major kitchen remodel could total $56,768 and add $38,485 to the resale value of the home. The cost to value recouped on both remodeling jobs declined this year, with the bathroom job down 2.5 percent and the kitchen remodel down 6.4 percent, according to the report.
This begs the question for homeowners: Should you remodel at all?
It depends. Housing markets vary, but in general, unless someone is looking for a fixer-upper, homebuyers are seeking updated kitchens and baths.
“In my market, the buyer generally will pay more for someone else to do the work. They don’t want to disturb their family by living through construction,” says Dawn McKenna, real estate broker at Hinsdale, Illinois-based Coldwell Banker Residential Brokerage.
When considering a potential remodeling job, McKenna advises homeowners to evaluate their property. “Does it have high ceilings? Does it have good bones? Is it in a good location? If the floor plans are worthy, you should update your kitchen and bath because you will reap the rewards at resale time. If your house is priced and marketed properly and it looks like a ’10,’ it will sell significantly faster,” McKenna says.
For homeowners willing to dive into a remodeling project, it pays to think long term. “You’ve got to pick things that are timeless and good enough quality that will stand the test of time,” says Ilyce Glink, author of numerous real estate books, including “100 Questions Every First-Time Home Buyer Should Ask.” “When I remodeled my kitchen 16 years ago, I chose natural birch, nickel hardware, granite and neutral tile. People think we just redid our kitchen,” Glink says.
As you begin to pick appliances, colors, countertops and cabinets, think about resale. “I always tell my clients: You want to enjoy it, but don’t pick some crazy color. You want to appeal to the masses,” McKenna says.
Kitchens: What’s in. Great rooms, which are often large, separate family rooms with vaulted ceilings, are out. Buyers today are seeking an open kitchen-family room, where a large kitchen opens up into a family room and has no walls separating the two, McKenna says. If you have space, an island with a breakfast bar is ideal.
“Everybody wants an open kitchen-family room. They will do without a living room, and some people will even forego a dining room,” McKenna says. Stylistically, light, bright and open space appeal to homebuyers. Keep it clean-lined and sleek, McKenna advises.
Among countertop materials, McKenna favors Quartzite and Caesarstone because they are low maintenance. For appliances, “we are still seeing Wolf and Sub-Zero in the upper bracket, but Miele is being introduced in more transitional and contemporary applications. I also think Jenn-Air is making a comeback, due to the price point and uber-current features,” McKenna says.
Built-in kitchen desks were all the rage about 10 years ago, but they’ve fallen out of favor, Glink says. Homeowners are replacing kitchen desks with “more usable” countertop space and shelving, she says. “How people use technology in their kitchen has evolved for designers over time. People are using laptops now, and you don’t need a whole desk for that,” Glink explains. Consider building a technology station with lots of outlets in your kitchen, and create a space for everyone to recharge their electronic gadgets and cellphones.
Smart home technology is also an attractive feature for homebuyers. Homes that boast programmable thermostats and the ability to lock your front door remotely “make your house sell faster for a little more money,” Glink says. Such technology extends to the kitchen as well. “Today we see refrigerators that will monitor and know when you are out of milk. In the next few years, you will be able to place your order with your food delivery service that will automatically deliver milk once you are out,” Glink says.
Speaking of refrigerators, homebuyers are looking for a special place to store and chill their favorite chardonnay. “We are seeing more demand for wine refrigerators that have several temperature areas,” Glink says.
Trends in baths. Homeowners today are choosing larger shower spaces with all the trimmings, such as aromatherapy steam showers and more. “We are seeing a trend toward incredible shower experiences, with big, round rainwater showerheads. We are seeing places to sit in the shower and more elaborate shelving. Lots of glass tile and multispray heads,” Glink says. These shower spaces can include built-in containers that allow you to preload your shampoo and conditioner.
When it comes to the number of bathrooms in your house, more is almost always better, real estate experts say. Still, the cost-to-value numbers aren’t encouraging in this year’s market. A midrange bathroom addition costs $39,578 but will only recoup 57.8 percent of the job cost at resale time, according to the Remodeling 2015 Cost vs. Value Report.
Although you may not fully recoup your kitchen or bath remodel, there are other factors to consider. After all, you’ll get to enjoy that new kitchen or aromatherapy shower, and experts say updated homes move faster at resale time.
“Buyers don’t want to do big work in their house, especially if they’re paying top dollar for a property. No one is going to pay top dollar for a house with old kitchens and baths. … If you spend $60,000 on a new kitchen or $30,000 on a refresh and can sell your home for nearly top dollar immediately, what’s that worth?” Glink says.
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