7 Renovations that Increase Home Value in 2023, The housing market is a complex and ever-shifting landscape. While 2022 saw skyrocketing prices reach their peak, experts now predict a period of moderation over the next year as interest rates stabilize.
Despite the uncertainty, one aspect remains clear – making even small renovations and upgrades to your home ahead of listing will pay dividends through added value and buyer competition.
There are remodeling and major touch-up projects known to provide jaw-dropping returns on investment year over year. Kitchen overhauls, bath expansions, outdoor oases, smart home upgrades – these sell for top dollar. Indeed, a 2021 report by the National Association of REALTORS found homes with renovated kitchens sold at a median 10% higher price compared to similar non-renovated houses.
7 Renovations that Increase Home Value in 2023
As the spring and summer home shopping seasons gain momentum, investing in these proven home improvement areas can position your property to stand out, sell faster and yield the highest possible sale price in 2023. While not an exhaustive list, focusing on these seven renovations offers perhaps the greatest potential payoff.
Kitchen Remodels Set the Table for Profit
In real estate, the kitchen truly reigns supreme. This central hub and literal heart of a home leaves an impression – for better or for worse. Modern buyers favor functional, open kitchens blending smart layouts with on-trend finishes. When done right, kitchen remodels in particular set the table for a big profit boost upon future sale.
Full overhauls involve upgrades ranging from knocking down walls for a spacious open concept to swapping an dated electric stove for sleek cabinet-front refrigeration. Appliances with high-end steel detailing have staying power while aging laminate cabinets come across as past their prime. Even smaller scale changes offer an outsized impact, with minor facelifts through quartz countertops, tile backsplashes and new fixtures breathing new life into existing cabinetry.
Return on investment metrics prove just how pivotal kitchen design can be. The Remodeling Cost vs. Value Report by Hanley Wood reveals midrange major kitchen remodels costing an average $66,196 recoup about 75% of expenditures upon selling. Meanwhile, upscale renovations up to $134,745 achieve an even higher 79.5% ROI. Even minor remodels come out ahead at 78.3% ROI on just $26,214 invested. Clearly when prepping to list, dialing up the style and functionality in your kitchen pays – to the tune of potential five figure sale bumps.
Bathrooms Make a Splash for Big Value
While kitchens top most wishlists, bathrooms follow closely behind as one of the most influential spaces dictating listing prices and buyer competition. Especially in older homes, dated bathrooms with tiny tile, poor lighting, and outdated colors or fixtures scream for a face-lift to meet current buyer expectations.
On average, an extra full bathroom itself adds about $20,000 value to a property according to Zillow data. Expanding small existing bathrooms or adding a half-bath to a 3-bed home holds nearly as much profit potential based on return on investment metrics. The right upgrades not only recoup costs but significantly lift home value.
A midrange bathroom remodel averaging around $19,000 yields an enviable 73% ROI per the Remodeling report – while upscale overhauls from $61,000 to $111,000 bring even higher 79% to 82% recouped through sale proceeds. Swapping out materials, plumbing and layout to open up space and highlight spa-like finishes puts more money back in seller’s pockets. Even small touches like new lighting, counters or cabinets make a noticeable splash.
Outdoor Living Extends Space and Value
Today’s buyers prioritize not only square footage indoors but also usable land outside. Surveys by the American Society of Landscape Architects reveal over 80% of homeowners want landscapes that extend living areas. Outdoor enhancements like lush landscaping, swimming pools, fire pits, fully equipped outdoor kitchens and covered patios give families more flexibility.
Value-boosting outdoor renovations run the gamut depending on climate, space and budgets. In warmer regions, sparkling pools and spas add over $25,000 on average while elaborate pool houses with bathrooms and grill stations push values even higher. More nationwide, adding a high quality wood deck or paved patio area to create an entertainment space holds strong universal appeal – increasing resale from 2% to over 10% on lower budget projects below $5,000.
Garage Upgrades Drive Premium Prices
Similar to kitchens and baths, garages also play an integral yet understated role for many buyers house hunting today. These spaces not only provide vehicle storage capacity but also serve as maintenance zones, hobby areas or evenbonus gathering areas in some conversions. Upgrading and optimizing garages therefore adds functionality that homeowners desire and buyers are willing to pay premiums for.
Depending on layout, older garages can instantly date homes otherwise updated for modern living. Repainting cracking floors, replacing tired doors and brightening up walls represents low cost, high visual impact updates. For more dramatic overhauls, epoxy coatings come in endless styles from classic gray concrete to decorative stone at less than $3,500 on average. Refinishing the floors alone returns 75% at resale. Enclosed, ceiling-high storage racks offer a valuable organizational system.
For households needing more square footage, converting a garage into living space like a family room adds lasting property value from 15% to 25%. Whether simply freshening up or fully transforming these easily overlooked spaces, garage upgrades provide excellent profit potential upon selling for thousands more.
Home Additions Multiply Value
Sometimes upgrading what exists fails to meet a homeowner’s evolving space requirements. Constructing true home additions takes housing stock from dated to desirable with new bedroom suites, bathroom expansions, bonus rooms over garages, basement finishings and more personalized layouts. Additions not only solve needs for more room but also deliver strong returns on investment long-term.
The scale and specifics of additions vary dramatically based on budgets and feasibility. Full second story additions above 1,200 square feet involving structural work, poured concrete and framing might cost $200,000-plus but add enormous livable space. More modest projects like a 24 x 24 master suite addition behind a home at ground level often run $120-$150 per square foot. Three season room additions enclosing decks can minimize costs.
No matter the specifics, home additions on average recoup over 70% of expenditures in increased home sale value. Though addition costs are not insignificant, the boost to both enjoyment and property value outweighs pure renovation costs alone making most additions a smart play for recoverable value.
Curb Appeal Shines Through Landscape Upgrades
While renovating indoor spaces captures attention, sprucing up landscapes often proves equally as valuable for home values thanks to that intangible concept: curb appeal. Properties with neatly manicured greenery, lush garden beds and welcoming entryways simply look loved from the street. Pavers lining the walkway, potted plants framing an entry archway, an artful water feature visible from the curb through thoughtfully edited ornamental trees – thoughtful details add polish.
Maintenance matters as well in landscape appeal and value perception from keeping lawns neatly mowed with clean edges to pruning overgrowth. However, aging homes with nondescript front lawns barely adding curb appeal stand to gain over 15% value by investing $5,000 to $25,000 into well-designed landscaping transformations. Hardscaping adds texture and value too through patios, retaining walls, rock gardens, firepits and pools. These landscape investments demonstrate pride of place to buyers who are willing to pay more for picture perfect curb appeal.
Smart Home Tech as Standard Fare
Once a luxury add-on, smart features and techforward home systems now qualify as expected fare for modern listings. In 2023 selling seasoned houses constructed pre-voice assistants and WiFi, integrating some home automation earns advantage. Sixty-three percent of buyers now see tech accommodations as baseline basics rather than upgrades in newly constructed properties. Though tech wears out quickly, today’s dated houses updated with core smart components gain an edge.
Integrating technology into properties need not break budgets. Stats show that even modest scale smart home upgrades averaging under $2,000 return 300% gains in home sale values. Mid-tier projects from $2,000 to $15,000 recoup 250% of layouts. Streamlining living through app-controlled lighting, climate adjustments, security cameras, irrigation controllers and more resonates across buyer groups for enhanced value perception earning thousands over non-smart counterparts.
Conclusion
In an up-and-down market, gains from upgrades prove a reliable hedge against housing bubbles and declining values. The National Association of Realtors 2022 Remodeling Impact Report indicated that homeowners who made updates added an average of $150 per square foot to property appraisals nationwide – a return ranging from 50% to over 75% of project investment costs.
While every home and locale differs, strategically enhancing kitchens, bathrooms, outdoor living potential, garages, home footprints and smart functionality unlocks added home value. In addition to supporting changing household needs, these renovations convey pride of ownership and curb appeal that leave buyers competing. For those seeking to sell soon or simply bolster the equity held in an existing home, proactive upgrades unlock immense ROI both financially and in quality of living. The data and dollar signs don’t lie – improving homes improves bottom linesexponentially.
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