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Since 2003, Remodeling Magazine has been annually gathering data of remodeling projects across the United States to generate national and regional remodeling cost averages with realtors’ input of the increase in home resale value average rate of return. This information is compiled and generates the Cost versus Value Report. It is valuable if you are thinking about remodeling and want to get an idea of the average cost to plan your remodeling budget and how much the current market would give as a return on investment. The report is also a measurement of an economic indicator of the housing market, which is showing great improvement.
The National Association of Home Builders reports approximately 60 percent of homeowners remodel soon after they have purchased their home to customize it to their lifestyle and personality. Those who have been in their home for a while, remodel to update and improve their experience in their home about every five to 10 years, doing a major remodel every 16-20 years. If you’re interested in renovation check out this quote about adding on rooms to a house.
The average cost of a remodeling project has increased 4.7 percent, but the rate of return on investment is 6.7 percent higher than the 2015 report. The biggest gains were for upscale projects, rather than mid-range sized projects. Some of the top return on values as compared to the previous year were for an upscale master suite addition (6.5 percent more), and an upscale kitchen remodeling project (4.2 percent higher return on investment). For those who are planning to sell and move, curb-appeal remodeling has the best return, such as addition of stone veneer, garage door upgrade and having a steel front entry door.
Based on the trend of these reports, the housing market is on a strong recovery and Remodeling Magazine projects that the value of return of investment (ROI) in remodeling may grow an additional 7.3 percent in 2016. The average rate of return on these mentioned projects is 65 percent. Another popular remodeling project is a family room addition, having a rate of return of 73.4 percent.
It’s nice to think that someone could pay about 75 percent of the cost of you to customize and beautify your home just the way you want it! The rate of return will be affected by having a well-designed, quality built project. To check out the average costs for these projects and a link to the report, go to cookremodeling.com blog, and look for 2016 Cost vs Value Report.
Happy Home Remodeling!
Janet B. Cook, CAPS, President of Cook Remodeling who is celebrating their 37th year, blogs (with photos!) on cookremodeling.com. Join their Facebook page for homeowner tips.