When thinking of home renovations, most homeowners decide which projects they want to tackle based on the upfront cost of the project. Obviously this is an important aspect to consider, but it doesn’t tell the whole story. One thing we tell customers who are looking to upgrade their homes is to look at the return on investment (ROI) alongside the initial price tag.
Below are some of the home renovation projects with the best ROI, based on data collected for the Remodeling 2020 Cost vs. Value Report. The data shows the average upfront cost alongside the resale value of each project. The information below uses the average cost and value of projects across Iowa, Minnesota, Missouri, the Dakotas, Nebraska, and Kansas.
Minor Kitchen Remodel (Midrange)
Upfront Job Cost: $23,016
Resale Value: $17,002
Upfront Cost Recouped: 73.9%
Kitchen and bathroom remodels have some of the best ROI of any home project. Because styles and preferences of home buyers can change quickly, choosing “midrange” amenities for your remodel is best for the ROI.
Entry Door Replacement (Steel)
Upfront Job Cost: $1,841
Resale Value: $1,086
Upfront Cost Recouped: 59.0%
The ROI on entry doors is at the top of this list because your entrance doors help form buyers’ first impressions.
Siding Replacement (Vinyl)
Upfront Job Cost: Upfront Job Cost: $13,647
Resale Value: $7,769
Upfront Cost Recouped: 56.9%
New siding can give your entire home a facelift and vinyl siding requires very little maintenance.
Siding Replacement (Fiber-Cement)
Upfront Job Cost: $16,169
Resale Value: $9,074
Upfront Cost Recouped: 56.1%
Fiber-cement siding gives about the same ROI as vinyl siding, but is a bit more expensive upfront.
Window Replacement (Vinyl)
Upfront Job Cost: $17,240
Resale Value: $9,215
Upfront Cost Recouped: 53.4%
One aspect of replacing your windows that isn’t factored into these numbers is the money you can save on energy costs— and this can be a significant amount if you have a lot of windows and/or your current windows are older.
Bathroom Remodel (Universal Design)
Upfront Job Cost: $33,326
Resale Value: $17,760
Upfront Cost Recouped: 53.3%
As more people are looking to age-in-place, universal design is a trend that may be more than just a trend.
Major Kitchen Remodel (Midrange)
Upfront Job Cost: $66,159
Resale Value: $34,889
Upfront Cost Recouped: 52.7%
Because of the ROI on kitchen projects, homebuyers usually consider kitchen remodels one of their first home projects.
Bath Remodel (Midrange)
Upfront Job Cost: $20,451
Resale Value: $10,728
Upfront Cost Recouped: 52.5%
Bathroom remodels, along with kitchen remodels, have some of the best ROI of any home project.
Deck Addition (Wood)
Upfront Job Cost: $13,404
Resale Value: $6,567
Upfront Cost Recouped: 49.0%
Who doesn’t love a summer evening on their own deck? The ROI for a wood deck is a bit higher than it is for a composite deck, but a wood deck is going to require more regular maintenance, so factor in your time and energy when deciding between decking materials.
Window Replacement (Wood)
Upfront Job Cost: $21,014
Resale Value: $10,204
Upfront Cost Recouped: 48.6%
Wood framed windows look great, but will cost more upfront than vinyl and will require more maintenance.
Roofing Replacement (Asphalt Shingles)
Upfront Job Cost: $23,784
Resale Value: $10,699
Upfront Cost Recouped: 45.0%
Because replacing a roof can be such a major project, homebuyers will usually ask when the roof was last replaced very early in the buying process.
Deck Addition (Composite)
Upfront Job Cost: $18,929
Resale Value: $8,381
Upfront Cost Recouped: 44.3%
While the ROI is slightly lower on a composite deck than a natural wood deck, a composite deck requires very little maintenance. How much effort you want to spend on maintaining your deck should factor into this decision.
We hope this information allows you to make the best decision when you’re ready to tackle your next home project, but there are plenty of factors that can affect your actual ROI. When you’re ready to start the process, make sure you consult experienced, local professionals who can provide you with information that is specific to your home and the market where you live.