There are several factors that can significantly increase the value of a house. The most impactful improvements tend to be renovations and upgrades that maximize living space, boost aesthetic appeal, enhance functionality and comfort, or add desirable amenities.
Adding Living Space
One of the best ways to increase home value is to add more living space. This can be achieved by building an addition, converting an attic or basement into finished rooms, or adding a second story. According to real estate data, additions that increase square footage can boost resale value by 60-75% of the project cost.
Finishing Basements and Attics
Turning unused attics and basements into living spaces is an effective way to gain extra bedrooms, bathrooms, recreation rooms, home offices, etc. without altering the home’s footprint. On average, a finished basement can offer a 70% return on investment in increased home value. The ROI on a finished attic can be even higher – up to 80-90%.
Building Up or Out
Adding a second story addition or expanding the home’s footprint (e.g. building out the back of the home) creates significant living space for a relatively high return. Second story additions in particular can boost value by approximately $55 per square foot. Horizontal additions also offer strong value – generally recouping about 85% of construction costs.
Curb Appeal Upgrades
Enhancing your home’s exterior aesthetics pays off when selling. Curb appeal projects like new roofing, siding, entry doors, landscaping, fencing, lighting, and fresh paint can potentially boost value by 7-15%. Furthermore, good landscaping alone can increase a home’s value by about 10-15%.
New Roof
A new roof is a worthwhile investment, adding approximately 107% of project cost to the home’s value. New dimensional shingles or other premium materials make the biggest impact. On average, asphalt shingles offer a 78% ROI, while slate tiles can offer over 100%.
New Siding
Replacing worn or dated siding instantly gives your home exterior visual appeal. On average, new vinyl siding offers a 78% ROI, while fiber cement siding returns about 80% of project costs. More dramatic upgrades like natural wood or masonry cladding offer a slightly lower ROI, but make a noticeable aesthetic improvement.
Landscaping
Well-designed landscaping that uses lush plants, flowers, trees, rock features, pathways, lighting, etc. boosts curb appeal. Simple DIY projects can be done affordably. But hiring a professional landscaper to install high-end landscaping could return over 100% of costs at resale.
Kitchen and Bathroom Remodels
Remodeled kitchens and bathrooms are two of the most valuable home improvements. According to the National Association of Realtors, minor kitchen updates return about 81% of costs, while major remodels return about 75%. For bathrooms, minor remodels yield 77% ROI and majors yield 72%.
Kitchen Upgrades
Some kitchen upgrades that offer great bang for your buck include new countertops (92% ROI), midrange appliances (107%), and new flooring (107%). Completely gutting and renovating a kitchen recoups about 61% of costs on average.
Bathroom Improvements
In bathrooms, replacing fixtures like toilets (103% ROI), bathtubs (102%), or faucets and showers (100%) is advisable. New tile flooring (92% ROI), countertops (91%), and sinks (86%) also add value. Whole bathroom remodels return 57-60% of costs on average.
Outdoor Living Spaces
Outdoor living additions to a home’s yard can significantly boost value. Decks, patios, pergolas, gazebos, outdoor kitchens, pools, hot tubs, and built-in fire pits or grills are desirable amenities that offer an excellent return on investment.
Backyard Deck
Adding a deck or replacing an existing one generates significant interest from home buyers. A high-end wooden deck returns 75% or more of costs. More affordable options like composite decking offer lower returns, but are still worthwhile.
Patio and Landscaping
Outdoor patios made of stone, pavers, or concrete offer similar returns as decks if well-designed and installed. Impressive landscaping surrounding patios boosts overall aesthetic appeal. Focal points like fire features, water features, or built-in barbecues can maximize value.
Swimming Pools
In-ground pools are costly but greatly enhance a backyard oasis. According to Zillow, homeowners recoup about 45% of in-ground pool installation costs. Pools in warm climates or resort-style backyards yield higher returns.
Energy Efficient Features
Incorporating energy efficient upgrades when renovating or remodeling a home is wise for both environmental and financial reasons. Green features like solar panels, ENERGY STAR appliances, new windows, modern HVAC systems, added insulation, etc. can reduce energy costs by 15-30% while also increasing resale value.
Solar Panels
Home buyers are increasingly looking for energy efficient homes with low utility bills. Adding solar panels can increase a home’s value by approximately 4.1% according to a Lawrence Berkeley National Laboratory study. Their high returns and environmental benefits make them a smart investment.
New HVAC System
Replacing an aging or inadequate HVAC system makes a home more comfortable for buyers. New Energy Star certified systems that heat and cool efficiently offer returns of 95-150% of the project cost. Smart upgrades provide energy savings that buyers will appreciate.
Energy Efficient Windows
High-performance replacement windows stop drafts, reduce noise, and lower energy costs. Returns vary based on the efficiency rating, cost, and materials. But in general, double-pane windows return 70% of costs, while triple-pane can return 90% or more.
Conclusion
Any upgrades that increase living space, boost aesthetic appeal, enhance functionality and comfort, or add desirable amenities will likely boost your home’s resale value. When planning renovations, focus on projects that provide the highest return on investment, meet local housing market demands, and align with your budget.
