By sunny 
Many people have misconceptions about renovating a home before selling, and feel that it is a waste to spend money on renovations when selling a home. However, when the market was in a slump in the last two years, a packaged home can stand out from the rest of the listings, and renovations are still the fastest way to add value to a property. As a result, many Toronto homeowners are choosing to renovate and upgrade their homes before selling.
However, there is a lot to be said for renovating your home before you sell, and not just any renovation can achieve the same results, but sometimes it can even backfire and make your home harder to sell. Today we’re taking a look at 5 of America’s favourite home improvement projects and whether they can increase the value of your home.
America’s 5 favourite renovation projects
- Putting up solar panels
- Getting a new roof
- Redoing the kitchen
- Remodelling the bathroom
- Retrofitting energy efficient windows
So which renovations increase the value of your home, or at least save you some money, when selling your home? Experts give their opinions on these 5 favourite American renovations and sift through the ROI data.
Do solar panels increase home value?
American interest in solar energy systems is growing thanks to the Inflation Reduction Act, which provides homeowners with a 30% tax credit for solar installations.
The average cost of a rooftop solar system that meets the energy needs of a typical American home is $15,300, including installation. Under the right conditions, adding solar can significantly reduce the cost of monthly electric bills. Additionally, data suggests that a house with a solar system can increase in value somewhat when it is sold.
According to a 2019 Zillow study, homes with solar systems sell for an average of 4.1 percent more than comparable homes without solar. The sales premium varies by real estate market, such as 5.4% in New York and 2.7% in Riverside, California.
However, every homeowner who is going to put in a solar system should definitely test themselves and use Google Project Sunroof to test how many hours of available sunlight the house will receive per year before making a decision.
Will a new roof increase the value of my home?
According to the U.S. Census Bureau, purchasing a new roof costs an average of $8,000, with the cost depending heavily on materials and size.
According to Remodeling Magazine’s 2022 Cost and Value Report, the average cost of a roof with fresh asphalt shingles is about $30,000, with a return of about 60 percent. Meanwhile, replacing a metal roof costs about $50,000 with a return of about 50 per cent.
Does a New Kitchen Increase Home Value?
New kitchens are more attractive to home buyers. As with most home improvements, the impact on the sales price depends on the location of the house, the value of the home and the extent of the remodelling.
According to data from Opendoor Home Improvements, a home buying company, a complete kitchen remodel of a home originally valued at $200,000 in Atlanta, Georgia, increases the value by an average of 6%. In Tampa, Florida, home values increased by an average of 8.45%.
According to HomeAdvisor, a complete kitchen remodel costs about $150 per square foot, and some upscale kitchen remodels can climb into six figures.
Does a new bathroom increase home value?
According to Zillow data, bathroom remodels have the biggest payoff of all home remodels. For every $1 spent, even minor cosmetic changes can add $1.71 to a home’s value.
Experts say, ‘The bathroom is one of the few rooms where Americans spend a lot of time, and everyone in the home uses it, making bathroom renovations a good investment.’
The average bathroom remodel costs about $11,000, according to HomeAdvisor. Decorative and detailed tiles can be pricey, especially when used throughout the bathroom, and experts recommend using only expensive tiles for decorative borders or feature walls and considering plain tiles for the rest, which typically cost less than $3 per square foot.
Do energy-efficient windows increase the value of a home?
Installing energy-efficient windows will yield a significant return on investment when selling your home, with the added benefit of reducing energy bills.
According to HomeAdvisor, energy-efficient windows can cost anywhere from $120 to $1,200 per window, and hiring a contractor to install them can add an additional $200 to $800 per window. However, depending on the type of windows installed, the average rate of return should be between 60 and 70 per cent.
Energy-efficient windows are also eligible for a tax credit of up to $600 per year (plus $250 per door, up to $500) under the Inflation Reduction Act. This is double the previous lifetime limit of $300 for energy-efficient windows, which expires on 1 January 2033, under the measure.
Other renovations that may increase the value of your home
Paint:
A simple coat of paint in neutral tones is a great place to start. This makeover can be done without investing a lot of time or money. Spend a weekend revamping the wall colour and buyers will be more interested in the house. Neutral tone colour choices include: grey, white, beige, charcoal, and light blue. Be careful to avoid current fads such as wallpaper; trends can go out of style quickly or not be to buyers’ tastes.
Front door:
Paint the front door or replace it with a new one to enhance first impressions. A brightly coloured front door will make the home more memorable. If you’re not interested in a colourful front door, you can also replace it with a sturdy new steel door, or simply convert an old screen door into a glass door for a fresher look. Just be careful not to overspend and make the front door match the look of the house.
Improve energy systems:
On average, the project that returns the most value to the homeowner is converting a fossil fuel heating unit to an electric heat pump. According to Remodeling Magazine, electrifying your HVAC system in this manner costs about $17,747, but will add about $18,366 to your resale value. Overall, that’s a 103.5 percent payback on the cost.
Entrance and garage door replacement:
For door replacements, especially garage and entry doors, these low-cost projects can significantly improve a home’s curb appeal, which is something buyers notice. According to the report, replacing a garage door costs about $4,302 but can add about $4,418 to resale value, while a steel entry door costs about $2,214 and can add about $2,235 to resale value.
Remodeling a home’s exterior walls:
Modifying the exterior walls of a home can also increase the value of the home by the same amount as the cost of the project, although choices must be made about the materials used. According to the report, replacing the bottom of the home with stone veneer (a type of stone) would recover approximately 102.3% of the cost (cost of approximately $10,925, resale value of approximately $11,117). However, re-covering with fibre cement would cost $19,361, but would only add about $17,129 to the resale value.
In conclusion, the most suitable renovation and remodelling project can be selected wisely based on the condition of the house and budget, which will enhance the living experience as well as make the house worth more. By understanding the value of home renovations and choosing renovations that increase the value of your home, you can make your home more competitive in the marketplace.