Remodeling report finds that kitchen, roof work has the most impact
Upgrades to a home's kitchen were most likely to have a positive impact on the home's resale value and a homeowner's enjoyment of the property. Real estate agents considered roof work to be the most valuable exterior improvement, although homeowners were more likely to feel a sense of accomplishment and enjoyment if they put in new windows.
These were some of the findings of the 2017 Remodeling Impact Report. This is the second year the report has been issued by the National Association of Realtors and the National Association of the Remodeling Industry.
The report is based on 1,971 responses to a survey issued to NAR members and 382 responses from NARI members. It also includes 2,287 responses from homeowners who answered questions about their last remodeling project.
Overall, three-quarters of homeowners said they had a greater desire to be in their home after a remodeling project. Sixty-five percent said they enjoyed their home more, and 77 percent said they felt a major sense of accomplishment as a result of the work.
Thirty-two percent of homeowners completed the project on their own, while the same share hired a professional. Twenty-one percent purchased the materials but left the labor to a pro, while 14 percent contributed some labor.
Realtors ranked a completed kitchen upgrade as the most appealing project to buyers, followed by a kitchen upgrade and bathroom renovation. These projects were also seen as having the most positive impact on a home's resale value.
A complete kitchen renovation had the most positive impact on homeowners' morale. Ninety-one percent said they enjoyed their home more after this work, while 89 percent had more desire to be in the home and a sense of accomplishment.
NARI estimated that the average complete kitchen renovation costs $65,000, while the average Realtor estimated that $40,000 of this cost was recovered through an improvement in value. This was a return on investment of 62 percent.
Eighteen percent of Realtors said they had suggested that sellers do a complete kitchen renovation before selling their home. Fourteen percent said this project had helped close a sale.
Realtors were more likely to suggest a less expensive kitchen upgrade. More than half—54 percent—said they have recommended that a seller complete this work, and 23 percent said it had helped close a sale. This project was estimated to cost $35,000 on average, with a return on investment of 57 percent.
Eighty-one percent of homeowners said a kitchen upgrade gave them a sense of accomplishment and a greater desire to be in the home. Seventy-six percent said it improved their enjoyment of the home.
Forty-four percent of Realtors said they had advised a seller to renovate a bathroom. However, only 6 percent said this work had helped close a sale. Bathroom renovations also had one of the lowest returns on investment, recouping only half of the estimated $30,000 required for the work.
Among homeowners who had renovated a bathroom, 78 percent said it gave them a sense of accomplishment. However, only 62 percent said it gave them a greater desire to be in the home and 57 percent said it improved their enjoyment of the home.
After the top three recommendations, Realtors were most likely to advise sellers to refinish their hardwood floors (37 percent), replace their HVAC system (23 percent) or put in new wood floors (21 percent). They were least likely to suggest converting an attic to living space, with only 2 percent saying they had done so.
Seven percent of Realtors said new wood floors helped clinch a sale, while 6 percent said refinished hardwood floors or a new HVAC system had played a part. Refinished hardwood floors were estimated to recover all of their expense in improved values, while new wood floors had a return on investment of 91 percent and HVAC replacement recovered 67 percent of their cost.
Homeowners were most likely to be proud of a closet renovation, with 96 percent saying this work led to a sense of accomplishment. Seventy-one percent said it gave them a greater desire to be in the home, while 65 percent said it made the home more enjoyable. However, just 5 percent of Realtors said they had recommended that sellers complete the work and none said it had helped to close a deal. The work had a return on investment of only 53 percent
Realtors were most likely to rank new roofing, vinyl windows, garage doors, and vinyl siding as the exterior remodeling projects with the most appeal for buyers. These were also the top choices for exterior improvements to boost a home's value.
Forty-five percent of Realtors said they had recommended that a seller get new roofing before putting a home on the market. Thirty-two percent said it had helped with a sale. New roofing also had the best return on investment of all exterior projects, recovering an estimated 109 percent of the average $7,500 cost.
Homeowners' opinions of their home were less likely to be improved by exterior remodeling, although 69 percent said new roofing gave them a sense of accomplishment. Fifty-nine percent said it gave them a greater desire to be in the home, while only one-third said it made them enjoy the home more.
Windows were more likely to appeal to homeowners, with 83 percent saying new vinyl or wood windows gave them a greater desire to be in the home and 76 percent saying they gave them a sense of accomplishment. Sixty percent said new windows made the home more enjoyable.
Twenty-one percent of Realtors had recommended that a seller install new vinyl windows, while 4 percent had recommended new wood windows. Eight percent said vinyl windows had helped with a sale, while only 1 percent said wood windows had done the same. Vinyl windows had an estimated return on investment of 76 percent, while the return for wood windows was 57 percent.
Twenty-four percent of Realtors said they had recommended a new garage door as an exterior improvement, although only 3 percent said this work helped lead to a sale. The estimated return on investment on this work was 87 percent.
Sixty-five percent of respondents said a new garage door gave them a sense of accomplishment. Only 44 percent said it made them enjoy the home more, while 41 percent said it made them want to be in the home more.
Seven percent of Realtors said they recommended that a seller install a new steel front door, while 6 percent recommended a new fiberglass front door or new vinyl siding. Only 1 percent said these improvements helped clinch a sale.
The estimated return on investment was 75 percent for both a steel front door and vinyl siding. It was 67 percent for a fiberglass front door.
Seventy-seven percent of homeowners said a new front door gave them a greater desire to be in a home, while 71 percent said it improved the home's enjoyment. Only 63 percent said it gave them a sense of accomplishment, however.
Sixty-four percent said vinyl siding gave them a greater desire to be in the home. Sixty percent said it gave them a sense of accomplishment, while 52 percent said it made them enjoy the home more.
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