What to consider before your next home improvement project

A major thing to consider these days before starting your next home improvement project is if the cost to do the work will be reflected in your homes value. This is even a more important if you think you may be listing your home for sale in the near future.

Who is doing the actual work? A major expense in a home improvement project is the labor cost. If you are doing all or the majority of the work, you are more likely to have a project that adds more value than cost to your home.

  • Is your home dated? The kitchen and bath area’s are the quickest way to make your home look more modern and will absolutely help your home sell. It is possible to not get a full return on your investment here but updating these areas will help your home sell faster.
  • Finish the unfinished. A great way to add value is increasing your homes GLA ( gross living area ) If you have an unfinished basement, a remodel which finishes off some portions of the basement can greatly increase the value of your home. By finsinshing a basement you will not increase your finished living space.
  • Improving your homes curb appeal. The most important impression of your home to a potential buyer in most cases is the first one. Any thing to help improve your homes curb appeal will help that first impression be a positive one. Once you catch their attention initially they may be more willing to over look an aspect that they may not like so much. First impressions are key!
  • Added value. As mentioned several times already, the key is to add more value to your home than you do costs. Most remodels do not recoup 100% of their costs. In other words, they do not add the same amount of value to the home as they do in costs.
  • Cost vs Value Report. In 2005 the National Association of Realtors created a report to help home owners compare the costs of different home improvement projects with the added value the project would give the home. It also listed the information as it related to different areas of the country. This report can come in handy when deciding which home improvement projects are most profitable.
  • Real Estate Appraisal – Real estate appraisers have a set of factors that they use for determining a home’s overall market value. A real estate appraiser would be able to give you an idea how much value a particular home improvement project would add to your home.
  • Energy savings. If your home improvement projects includes energy savings that it is important to compare the cost of the project to the monthly savings you will see in energy costs.

This is just a list of things I put together to help you decide if you feel the project is worth the cost to complete it. One factor that you cannot weigh here is the enjoyment your family would get out of the improvement.

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