Maximize Your Remodeling Dollars in 2012

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Let me start by saying that I absolutely love the topic of remodeling.  I am definitely a research nut, so I watch for these annual reports on renovations so that I can give you the cost versus value information.  These reports usually come out in January or February every year, and they rank the findings from the year previous.  So what is cost versus value anyway?

Cost versus value simply gives you an idea of what kinds of home renovations make the most sense when you look at how much of your cost you will recoup for doing a specific renovation.  In other words, you don't want to put new windows throughout your home only to find out that you will only recoup a small amount of the investment.

Currently, we are actually seeing the front door as the winner when it comes to cost versus value.  Garage doors are following in a close second place.  What does this say?  It finally proves that curb appeal and first impressions are everything for buyers when they have so many other homes to choose from.

Big impression projects can make or break a sale from the moment that a potential buyer gets out of their car.  A midrange entry door replacement will bring the highest payback at a national average of 102.1%.  This is according to 2010 research, but it's remained just as strong for 2011.

The next best return would be a midrange garage door replacement which gives you 84% of your value back.  An upscale redo of siding offers an 80% return on your investment.  This includes nicer types of siding such as fiberglass.

Once we step inside the home, a midrange kitchen remodel recoups an average of 73%.  By going into the backyard and adding a wooden deck, you'll get a 73% return as well.  One thing of important note in this slow growing economy is that four of the five top projects are considered to be “midrange”. This just further proves that sellers are very budget conscious right now.

Don't be shocked by the national average price tags that I gathered from our research that I will post below this content.  I will also share with you local tips that I use for helping sellers complete projects on a tight budget!

Here are some facts from various projects we have been apart of.

Project 1: Entry Door Replacement (Steel)
Cost $1,218
Resale value $1,243
Cost recouped 102.1%
(National averages)

Project 2: Garage Door Replacement
Cost $1,291
Resale value $1,083
Cost recouped 83.9%
(National averages)

Project 3: Siding Replacement (Fiber Cement)
 [Cost is based on 1,250 sqft of replaced siding.  Also note of big expense projects <those that cost $5,000+> since 2005 when Fiber Cement siding was added to the list, this replacement has ranked #1 each year.]
Cost $13,382
Resale value $10,707
Cost recouped 80.0%
(National averages)

Project 4: Kitchen Remodel (Minor)
Cost $21,695
Resale value $15,790
Cost recouped 72.8%
(National averages)

Project 5: Deck Addition (Wood)
Cost $10,973
Resale value $7,986
Cost recouped 72.8%
(National averages)

**My (Amanda’s) Cost cutting Tips**

You do need to be smart about these remodels and these are two places that a home owner can easily go over board and over budget.  A Tip I have seen useful is to leave the electrical and plumbing where it is originally, as moving these gets very costly and rarely a return on those changes.  However countertops, cabinets, flooring and appliances, as long as you stay mid range, or even low range, the Kitchen face-lift WILL get your home sold over the same sized home in your area, even with a $5,000 less price tag. Yours will sell first.

Some low-budget tips I share for the kitchens and baths are also:

Tidy up kitchen cabinets.
Potential buyers do open kitchen cabinets and look inside. Home owners can add rollout organizing trays so when buyers peek in, they feel like there’s lots of room for their stuff.

Add or replace tile.
By retiling very inexpensively, you make a room look way cleaner that it was.  We have lots of options here that offer $1 to $2 tile, so home owners have to pay only for the low-cost tile and labor to replace a dated backsplash or add a new one. You can also use inexpensive tile to upgrade bathrooms."

Add a breakfast bar.
When a wall separates a kitchen from a family room, I suggest cutting it out and opening it up to create a breakfast bar.

In one home, there was a cut-out in the wall between the kitchen and living room, we left the structure of the cutout, added an oversized granite breakfast bar, and put chairs in front of it. That cost about $600." It gave more work area, made a “WOW impression”, and really made the kitchen look updated.

Freshen up a bathroom without retiling.
With a dated bathroom, I recommend putting in a new medicine cabinet for $100 to $150, light fixtures for about $100, a faucet for $50 to $75, and a vanity for $200 to $300.

Instead of replacing the tile, the existing grout can be lightly scraped and regrouted, which leaves a haze that can be buffed out and will make the tile look brand new.

Also install glass shower doors. A French door adds a lot of panache and elegance for $250, and people will notice the door, not the tile. With all that, you’ve done a bathroom remodel for $1,000 to $2,000.

Spruce up cabinet fronts.
If the cabinets are looking old, worn, dated, and just plain tired looking, reconditioning is the least expensive move for under $1,000. This process takes out the nicks and scratches, reconditions it with oil, and then put new hardware on.

 For $1,500 to $4,000, owners can replace the cabinet doors and drawer fronts, and for $4,000 to $12,000, they can have all the cabinets refaced.

Replace light fixtures.
Most improved hit: In a foyer and in bathrooms and kitchens. This will provide a lot of pop for a little money.
If the kitchen has track lighting, I suggest the home owner spend $450 to $600 to have an electrician replace it with recessed canned lights on a dimmer switch to add ambience.  For about $700 I also suggest installing pendant lights over a kitchen island or peninsula

Additional noteworthy tips:

*Common renovation activities like sanding, cutting, and demolition can create hazardous lead dust and chips by disturbing lead-based paint, which can be harmful to adults and children. So be weary and careful the age of e paint and home you are dealing with prior starting these activities.

*As home buyers continue to rank affordability high on the priority list, more home styles are getting simpler and homes are becoming lower maintenance, according to the latest Home Design Trends Survey, conducted by the American Institute of Architects.

Simpler exterior details and the use of durable building products are growing in popularity, according to the third-quarter survey of architects. So keep that in mind when renovating!

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