6 Upgrades that Instantly Boost Your Home’s Resale Value
Realtor.com recently released its top ten list of housing markets expected to grow in 2023. Meanwhile, mortgage rates are expected to fall on the heels of softening inflation.
So, if you are a homeowner planning to put your place on the market, you’re probably wondering:
Which upgrades will bring me the most significant return on investment?
How can I provide the most appeal for potential home buyers?
What will help sell a property quickly (preferably above the asking price)?
The good news is you don’t have to add a whole new wing to your home. Even minor upgrades, such as a fresh coat of paint and other renovations, can add significant value.
Here are the six best home improvements to increase resale value.
1. Swap in Energy-Efficient Windows
Those original, single-paned windows may look charming but can be problematic.
Single-paned windows allow heat to pass from one side to the other easily. That means homeowners get a double whammy of costs: higher for heating during winter and higher for summer air conditioning.
These windows are also less soundproof, so traffic sounds or barking dogs aren’t muffled well. They also allow in more of the sun’s damaging rays, which can wreak havoc on fabrics such as carpets and furniture.
Those are just some reasons that replacing windows is one of the most popular yet affordable upgrades that add value to your home.
According to the U.S. Department of Energy, swapping out single-pane windows with a window sporting an Energy Star rating can save a homeowner up to $583 a year.
Window expert Michael Bohm tells Realtor.com that “a conservative estimate would be to expect to recoup about 70 percent of the purchase price of your replacement windows when it comes time to sell your home.”
2. Do a Kitchen Remodel (But Don’t Go Crazy)
Deluxe, high-end kitchens are a common feature in luxury homes. But for the average home buyer, a commercial-grade gas stove with six burners and a $2,000 vent is overkill.
Most home buyers look for simpler pleasures: a good layout, decent-quality appliances, and contemporary cabinet finishes.
That’s why Moving.com reports that a minor kitchen remodel will recoup 81 percent of its costs in average resale value, while a major kitchen overhaul typically only garners 53.5 percent of the cost.
Examples of minor kitchen remodeling include replacing the sink and faucet, installing an energy-efficient refrigerator, and updating the cabinet faces.
A major kitchen remodel has an average national cost of $131,510, reports Remodeling Magazine, and involves items like stone countertops and custom cabinetry.
Before you remodel a kitchen, Zillow.com recommends considering three factors—home value, local market, and budget.
We’d add: How bad is that kitchen?
An avocado-colored fridge and a total lack of counter space will turn off almost any home buyer.
After all, Zillow reports that 58 percent of buyers stated that a kitchen was either extremely or very important in their recent home-buying decision.
3. Install a Steam Shower
Easy bathroom upgrades for adding value to the home include replacing your old toilet with a new one, putting in attractive lighting, painting using a neutral palette, and updating the hardware.
But if you want to significantly increase resale value, you should take it further.
Today’s home buyers are searching for bathrooms that evoke an indulgent experience.
“We’re seeing that people no longer see the bath as a utilitarian space and more as an experiential space,” interior designer Young Huh told Elle Décor. “They're looking for spa-like experiences as well as a kind of theatrical beauty for what used to be a very interior and private space."
Merely using the term "steam shower" in a listing elicits a strong response. According to Zillow's "Listing Features That Sell,” a home advertised as having a steam shower can sell for up to 30.7 percent above the expected sale price.
The cost of installing a steam shower depends on several factors, such as if a remodel is turning a standard shower into a steam shower, the choice of materials, and how sophisticated you want to get with accessories such as fold-down seats, AromaTherapy, or built-in speakers.
On average, an at-home steam room is an additional 25 percent investment compared to a remodel that involved a regular shower.
>> See "Breakdown The Costs: What an In-Home Spa Will Cost You Over Time"
Filling up a standard tub takes 80 gallons for just one bath, which rises to 110 gallons for an extra deep tub.
By comparison, a week's worth of steam showers sips 14 gallons of water; about 1 ½ gallons per session. Energy consumption is also low—less than $1 per steam session—making a residential steam shower an affordable luxury that will appeal to home shoppers.
4. Add a Deck or Patio
The growing popularity of backyard decks, patios, and (in the East South-Central states) front porches are part of the trend toward enhancing a home’s exterior, reports Professional Builder.
Looking at the numbers, a wooden deck addition for midrange homes has an average national cost of $19,248. It adds a resale value of $12,464, according to "2022 Cost Vs. Value Report," from Remodeling Magazine.
Decks can cost from $1,200 to $25,000 or more depending on the materials used and add-ons like built-in seating and fancy railings.
Speaking of railings, ensure they are the correct height for your state's building code.
Also, consider architectural style.
A Victorian home with an elaborate wood back deck makes sense, while a Colonial home with the same treatment would look out of sorts.
So, when planning that wood deck addition, make sure it fits with the existing home styling.
You can add more safety and aesthetic appeal with exterior lighting such as spotlights or pendant lights. You'd be surprised how much properly placed light fixtures can bring out the existing beauty and increase a home's curb appeal.
5. Find a Spare Room
The number of bedrooms is critical when pairing a family with the right house, but many buyers also opt for extra room. In some markets, going from two bedrooms to three can add over $80,000 to the value of a home.
Where can you find this magical extra room?
Consider converting an unused or under-loved space, like an attic or basement, into an attractive living space.
Turning an unfinished attic into a bedroom with a bathroom costs about $75,000, according to the National Association of Realtors' “Remodeling Impact Report,” and retains 53 percent of the value when the home sells.
Converting a basement to a living area costs about $40,000, and the percent of value recovered from the project is 63 percent.
The key to selling your home for the best price is adding the most value you can for your square footage.
According to data from the National Association of Realtors, remodeled basements are particularly attractive to high-income buyers in the Northeast, Middle Atlantic, and Pacific Northwest
Beyond bedrooms, consider styling an extra room as a game room, a crafting area, a cozy home theater, or a potential apartment for an aging relative.
6. Install or Refinish Hardwood Floors
A beautiful hardwood floor can last decades, adding rich tones to the décor while standing up to abuse heaped on it from kids, pets, and foot traffic.
But as easy to clean and durable as wood floors are—and as popular as they are among today's home buyers—an older floor will probably need a little effort before you hang up a "for sale" shingle.
It will be well worth the time: The National Association of Realtors says refinishing hardwood floors can recoup 100 percent of the cost when it comes time for resale, making it one of the best home improvements to increase value.
For a new build or a home that previously had carpet, the average ROI for installing hardwood floors is in the 70 to 80 percent range, according to Realtor.com.
Kiplinger found that 81 percent of home buyers want wood floors as an amenity. You can also feel good about hardwood floors as this material boasts the longest lifespan compared with other flooring materials, like carpet, which needs to be overhauled every 8 to 10 years.
Home Improvements with the Best ROI
When determining which home improvements will bring you the most significant ROI, consider that home buyers are looking for something move-in ready.
Even minor investments in the home, such as adding curb appeal with landscaping, or pressure washing the siding, can help get a home sold more quickly and for a higher price.
You can raise that price even higher by picking and choosing the best home improvement for resale. New flooring can make its entire investment back when a home sells, and a steam shower can add up to 30% to a home's resale value.
Who doesn't want to hear a real estate agent calling you to say, "We've had multiple offers!"