Trying to decide which home renovation project to tackle next? To start you must decide if you are remodeling to improve an area of your home that is in need of some TLC or if you are remodeling to maximize your Return On Investment (ROI). If a specific area in your home needs TLC then your decision is straight forward. However, if all areas of your home are in decent shape and you are looking to maximize your investment in your home then your decision is a little easier.
To get the greatest return on your money, without adding additional square footage to your home, you should consider remodeling your kitchen. On average a Kitchen Remodel will yield an ROI of 80-100%! This is an amazing rate of return on any investment, but the added bonus is that as a homeowner you get to enjoy the benefits of your Kitchen Remodel until you sell your home.
Another room to consider remodeling to maximize your return on investment is your bathroom. As a side note, if you live in a home with more than two bedrooms and only one bathroom you might want to find a way to add an additional full or half bath somewhere in your home. This will dramatically increase the resale of your home. If that is not an option or you already have enough bathrooms for your home consider remodeling your current bathroom. On average bathroom remodels yield an ROI of 80-90%.
One of the main reasons both the Kitchen and Bathroom have such a high rate of return is that most buying decisions (including home buying) are based on emotion. When homebuyers walk into a home that has a run down kitchen or bathroom all they think of is the time, money, and headaches they will need to invest to get the room up to their standards. On the flip side when homebuyers walk into a home that has a fresh updated kitchen it can get them very excited. They know they won't have to lift a finger in this room to improve it, thus they can afford to spend a little more on the purchase price of the home knowing that the kitchen is already in great shape. The same principle applies to the bathroom.
You might ask yourself why all projects don't adhere to this same principle. The answer is even though it is a sound investment to replace you roof, siding, or windows the reality is all homebuyers assume that these will be present and in decent condition. There is limited emotional value in having a new roof so homebuyers don't get too excited about it either way. The return on investment for these projects ranges from 40-50%.
So if you want to increase the resale value of your home consider a home renovation of your kitchen or bathroom. After all, you may live in your home but don't forget, if you are like most homeowners, your home is also your largest investment. Be a savvy homeowner and treat your home as an investment.