Q Our kitchen needs
remodeling, but we’re
not sure how much to spend.
We don’t want to lose money
when we sell. How can we
learn how far to go?
Michelle Swanson, via e-mail
A If you’re concerned about
the future value of your
remodeling investment, consult a
local real estate agent or home
appraiser. Home values are highly
variable depending on your neighborhood,
the regional market and
the condition of your home.
These individuals will use these
local variables to estimate the
market value of your home and
tell you what upgrades will deliver
the best return.
Another useful source is the
annual Cost vs. Value Report on
the Remodeling Magazine Web
site (www.remodelingmagazine.com), which presents both the
national picture and the regional
breakdown for 22 major remodeling
categories (kitchens, bathrooms,
additions, windows, etc.).
Generally it shows that bathroom
and kitchen projects have strong
paybacks (more than 90 percent),
if kept in a mid-price range. The
payback drops if the project
includes major tear-outs or
upscale cabinets, appliances and
fixtures. Mid-range remodeling
of “space expansion” areas like
attics, basements and decks also
scores above 90 percent payback.
Additions, however, don’t fare so
well. Family rooms, master suites
and sunrooms score only about
80 percent return. In general,
“lifestyle” improvements such as
swimming pools, spas and exercise
rooms don’t pay back very
well either. But siding
replacement scored high
(fiber cement was
104 percent and
vinyl 96 percent).
Check the regional
breakdowns for these categories,
however, because
you’ll find wide variations.
For example, a major kitchen
remodel in Phoenix returns
about 99 percent, but the
return in Burlington, Vermont,
is only about 46 percent. The
value of other homes on your
block matters too. An expensive
remodel won’t deliver a high payback
if it makes your home the
most expensive one on the block.
But a modest remodel that
replaces an outdated kitchen,
updates a grungy bathroom and
upgrades a shabby exterior can
pay off well.
