Are you thinking about renovating your home this year? New figures from the 2004 Cost vs. Value Remodeling Survey from Remodeling Magazine suggest that sprucing up your kitchen or adding a master bath might be a good idea.
Last year, homeowners spend more than $138 billion remodeling their homes. Homeowners spend 75 percent of that fixing up their personal residences or vacation homes and investors spent the remaining fixing up their rental properties.
According to a new study from the Joint Center for Housing Studies at Harvard University, approximately 30 million homes, about 25 percent of all houses in the U.S. have been substantially upgraded since 1995. During the same 10-year period, home values jumped 70 percent.
About 40 percent of all remodeling projects are undertaken by the homeowner — Do-It-Yourself has become extremely popular. Half of all remodeling projects cost $10,000 or more and a third of all projects cost at least $25,000. For example, last year, more than 1.3 million new kitchens were installed.
If you’re going to fix up your home, you’ll want to tackle the projects that will help increase the value of your home. According to the Cost vs. Value survey, a minor kitchen remodel costs an average of $15,273. If you had to sell within a year of finishing the project, you’d recoup nearly 93 percent of your investment. In other words, you’d be able to raise the price of your home by $14,195 after finishing the project.
The survey found that the average remodeling project recouped more than 80 percent of its value within the first year. But some projects can have a much greater impact on your home value.
How can you choose the right renovation? Start by paying a visit to other homes that are on the market. Take note of the differences between your home and those that are commanding top dollar in your neighborhood. Are the kitchens and baths redone? Do they have master bedroom suite? Is there an eat-in kitchen or a family room attached to the property? Do the houses that sell fastest have new landscaping or “outdoor rooms?”
Work with a local real estate agent to figure out what you should do to add value to your property. Then, start talking to contractors and possible an architect (if you’re making structural changes, or adding on a room you will need the services of an architect).
Make sure the contractors are licensed, bonded and insured through the Illinois Dept. of Professional Regulation (www.dpr.state.il.us) and that there are no complaints about them at the Better Business Bureau (www.bbbonline.org) or at the Attorney General’s office (www.ag.state.il.us).
For more information on remodeling and how to select a good remodeling company, check out the National Association of the Remodeling Industry (www.NARI.org).
Contact Ilyce Glink: www.ThinkGlink.com
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