Renovating our homes gives us a chance to create a more custom space that works with our lifestyle and fits our needs. While renovating can add personal value to our homes, it also has the potential to add resale value when it comes time to sell or refinance. Some of the most impactful transformations come with big price tags so it’s important to know which renovations will give you the most bang for your buck before you dive in and start knocking down any walls.
Adding Outdoor Structures
Buyers often appreciate functional outdoor spaces, even more so now that the pandemic has helped us truly appreciate finding happiness in our own homes. With fresh air and time spent outdoors being recommended for mental health, it’s no wonder more and more Canadians are seeking to transform their outdoor spaces.
Often when considering outdoor structures, the first thing that comes to mind is a pool but adding one can be a very costly endeavour. During the pandemic, pool sales skyrocketed, and in some places, the waitlists for installs are now years long! If you want to take the route of putting in a new pool, just know that it’s unlikely you’ll recoup much of the value, especially when you consider how much they cost to maintain regularly. Keep in mind that the perceived value of a pool may also vary depending on the climate of the place you live and how many months per year the pool can be fully utilized.
If you’re looking to add more value with outdoor structures, you’ll want to consider fences, fire pits and decks as they all add significant value to your home when it comes to reselling, while also providing value to you as a current homeowner.
Fences provide additional privacy and give potential buyers a feeling of safety while also delivering excellent curb appeal. While the materials may not be cheap, the investment will be worthwhile from an added value standpoint.
Fire pits are a great way to increase the usability of an outdoor space in any climate, especially during colder months when most Canadians may feel trapped inside. Creating a fire pit area definitely has the potential to add extra value to your home.
Decks have become increasingly popular during the pandemic, with many Canadians investing in the material and labour to construct one where none previously existed. While there’s no shying away from the fact that they are not cheap, your investment can vary depending on the size of your deck and which materials you choose. This means you have lots of options; you can upgrade an existing deck to freshen it up, add on an extension or create a small deck to work within your budget. Regardless of which direction you choose, you’ll likely be able to recoup up to 80% of your investment!
Remodeling Your Bathroom
Bathroom renovations are one of the most popular projects for homeowners, and according to the Appraisal Institute of Canada, you can expect to recover 75% of your investment. It’s important to note that you don’t have to go all out to add value to your home. Replacing an old vanity, updating the plumbing, adding new light fixtures, a new tile floor and freshening up the paint can do wonders. If you’re considering doing a full bathroom renovation, you’ll also want to look at replacing the tub and toilet, making energy-efficient updates and adding a double vanity/sink (if you have the space), as it’s often ranked as the most desired bathroom upgrade for buyers.
Replacing Old Windows
New windows can do more than freshen up the look of your space, they can also add serious value when it comes to energy-efficiency. Potential buyers see new windows as a cost savings bonus because they know they’ll save a significant amount of money on their heating/cooling bills. While the upfront investment is likely to be $10,000+, it’s a worthwhile endeavour because it will add serious value to your home.
Adding Insulation To Attic
As we’ve explained above, adding insulation to your attic can have the same benefits as replacing the windows. This renovation project will lead to cost savings and can cut your monthly energy bills significantly, if done properly. Each space is different so talk to a professional to determine if you’ll require batt, blown-in insulation, foam board, or spray foam, to provide enough insulating value to keep the cool air from coming inside. Depending on the size of your attic, this can be a smaller investment and will likely cost around $1.50 – $5.50 per foot to insulate your attic, depending on the material you choose.
Replacing Your Roof
If you aren’t sure about replacing your roof, take the time to look up and assess the current situation. It’s likely that what you see will give you your answer quickly. If you spot buckling, curling or missing shingles, that’s a strong sign your roof needs work. You’ll want to consider a metal roof (typically around $20,000 depending on the size), which if installed properly with the right materials, can last a very long time. When you’re in the process of updating your roof, you may also want to consider adding value by installing solar panels. While many buyers may be hesitant to install them on their own, they’ll be attracted to a home that already has them installed and in use.
Adding Smart Home Technology To Your House
Market research shows that buyers are looking for smart devices that can make their lives easier, help them feel safer and allow them to manage their energy usage. Updating select items in your home using smart technology can add a lot of value for buyers who love the idea of technology but aren’t sure where to start doing it themselves. Walking into a home that’s already outfitted with the basics makes it a lot easier to approach and helps you add value when discussing things like energy management and security. Whether it’s a smart thermostat, doorbell, leak detector, deadbolt, outlets etc., you’re looking at an investment of around $1,500 for basic options.
Finishing Your Basement
When buyers see a finished basement, they see usable square footage and extra living space, which is always a bonus. While the job won’t be easy or cheap, the end result can add a lot of value to your home. Typical basement renovations cost $50 – $90 per square foot and will depend on the finishes you select and whether you’re adding a bathroom. According to Remodeling Magazine, you can expect a 75% return on investment for your basement renovation, but the key is to ensure the job is done properly so everything is insulated and the interior is protected from moisture. Buyers will be looking to ensure the basement is free of dampness, mold and any foundation damage so make sure if you’re choosing to invest in this big-ticket item, that it’s completed by a professional you trust.
Remodeling Your Kitchen
Kitchen remodels are one of the most popular renovation projects for homeowners. We spend a lot of time in our kitchens, cooking, eating with family and entertaining. For some, the kitchen is also a space to work and an extension of the living room. When it comes to kitchen remodels, typically the older the original kitchen, the more value you’ll get back by modernizing it. This process includes purchasing new appliances, replacing the flooring, backsplash and cabinets and changing out small things like fixtures and faucets. The average kitchen remodel will cost you around $20,000 – $50,000. The good news is that, according to Remodeling Magazine, you can expect to recoup over 80% of this investment!
Conclusion
As more and more homeowners invest in renovations, keeping pace with what buyers are looking for and what can increase your resale value is a very important part of the renovation process. While investing in renovations can significantly increase the value for you as a current homeowner, it can also do wonders for your resale price if/when you choose to move on down the road.
Even if you don’t plan to move, properly planned renovations can also positively impact your refinancing options. Part of the refinancing process allows an appraiser to take renovations into account when estimating your home’s value. A higher home value means you’ll have more equity and a lower loan-to-value ratio, which is always a win!
Before you dive into any new renovation projects, don’t forget to create a budget, do your research to determine which investments will yield the highest value and determine if your home’s location plays an important role in which amenities are most desirable. It’s also important to remember that renovating your home should be about creating the perfect space for you while you’re currently living there, and not solely focused on resale value. At the end of the day, it’s important to find a balance between the two so you can still enjoy your space while you’re living in it and know that the investments you’ve made will also help you add value for new buyers down the road.