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Saturday, January 25, 2014

Home Improvement Projects: Maximizing Your Investment

It is widely accepted that in this area, with our frigid winters, adding a pool is generally not something that will increase the value of a home. Neither, according to to Remodeling Magazine’s Cost vs Value Report, does adding a sunroom. Of course, if the benefit of hosting never-ending pool parties on hot summer days is important to the homeowner, these projects can be well worth the cost.

But there are plenty of other home improvements that can both appeal to the owner and add to the resale value of the home. In the Boston area projects that add the most value are a minor kitchen remodel, which retains an average of 89% of its cost at resale, a wood deck and upscale siding, both recouping 86%, and installing a new steel entry door, which retains 81% of its cost. Interestingly, the report showed that a midrange basement finishing project would only preserve 62% of its value. However sales seem to show that a basement finished to the point that it adds livable square footage to an otherwise small home can be an excellent investment.

The averages are very useful, but in deciding whether a project is worth the expense, there are more specific considerations. Improving a home to make it similar in size and condition to others in the neighborhood will generally provide a very good return on investment, and will help it sell more quickly. If a property is in terrible condition and renovated to meet or slightly exceed the standards of the neighborhood, the renovations can easily bring more than their full cost to the value of the house.

However, overimproving and adding high end features to a starter home that buyers in a particular price range don’t expect will not increase the value of the home by the amount spent on renovations. Making a remodeling project too personal can also do more to turn off future buyers than appeal to them. If a home already has a reasonably modern, neutral kitchen, for example, installing expensive custom hardware or a stainless steel backsplash may look great, but should not be done as an investment in the value of the home.

Whatever spring or summer project you may decide to undertake, it’s important to do your research and make selections carefully. Always get several prices and ask contractors for references and examples of their work. Finally, be sure to get everything in writing, and then, having done all your homework, enjoy either the results or a fast sale of your home!

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