Identify the values in remodeling
Dreaming of revamping your home? A new report outlines the return you'll get on a variety of upgrades.
By Judy Stark, Times Homes and Garden Editor
Published December 15, 2007
If you install a backup power generator at your home in the Tampa Bay area - at a cost of about $12,782 - you'll get back 93 percent of the cost if you sell your home within a year.
That's the conclusion of the annual Remodeling Cost vs. Value Report, which estimates the price of 29 typical projects in 60 cities and how much homeowners would recoup if they sold the home within the year. Details and the full report are at www.costvsvalue.com.
Here around the Tampa Bay area we know the value of a generator come hurricane time. The payback for a generator is considerably less throughout the entire South Atlantic region that includes Florida - just 67.1 percent of an estimated cost of $12,061. Nationally, the report estimates you'd pay $13,357 for a generator and get back 58 percent of your cost.
Replacing vinyl windows was another sure way to recoup most of your costs in the Tampa Bay market, and so was replacing the home's siding.
The lesson here: Markets are fragmented and local, and what adds value in one market may not appeal to buyers in another.
Another caveat: These are guidelines, not mandates for the "honeydo" list. If your home has only one bathroom, the report suggests, and every other home in your neighborhood has two baths, adding a second bath may make it far more desirable to potential buyers. You'll get back just 75 percent of your investment in the Tampa Bay area (and even less nationally), but you may sell your house faster and for more money once it has the newest bath on the block.
The most profitable project nationally was upscale siding replacement, which recoups 88 percent of costs, followed by wood deck additions (85 percent) and wood window replacements (81 percent).
Since 2002 the survey has offered a two-tiered scale: "midrange" projects and higher-priced "upscale" projects. A midrange bathroom addition has a cultured-marble vanity, a single-bowl sink, and a fiberglass tub/shower. The upscale bathroom addition has a stone vanity, two sinks and a whirlpool tub.
The report develops its information by having a software company estimate the cost of labor and materials for the 29 remodeling, addition and replacement projects in each market. Then 100,000 members of the National Association of Realtors - sales agents, brokers and appraisers - were invited to participate in an online survey to estimate what owners would recoup. More than 2,700 surveys were returned.
The general trend in remodeling is downward, the report says. That's no surprise in a market where remodeling costs have risen and the housing market has slowed (some would say stalled).
"After several years of accelerated remodeling spending and record housing appreciation, it is not surprising to see a moderating trend in the share of cost recovered for remodeling projects," the report's authors say.
Judy Stark can be reached at (727) 893-8446 or email@example.com.