Best & Worst Valued Construction Projects.
Posted 04-20-2013 at 01:04 AM by InspectorZo
Improving your residence is a great way to invest, right? Sometimes would be my answer. It depends on what project you plan for your home. Also, Are you planning on selling soon? Are you fixing it up to list it for sale? Are you simply thinking of your personal comfort regardless of resale value? Do you have a 5-10 year plan to sell? Do you plan to make this home your last?
Questions are valid and carry conditions that make the investment of home improvement more or less of a good investment.Truth be told, Not all projects are created equally. Not all have a return on their investment worth investing. With data compiled from Remodeling magazine’s Cost vs. Value report I present the 5 Best and 5 worst investment projects for your home. Let’s start with the 5 worst…
Building a home office.
This proposed project has virtually no return on investment when you go to sell the home.
Some buyers may need to undo and convert your “office” into the den or bedroom it once was. Many of us work from home but the surveys suggest that the majority of us choose to keep the precious space for home use without designating an office room. Remodeling magazine reports a national average for this project at $27,963 with a 42% return on investment (ROI).
This home improvement is more common on the west coast and where the climate is warmer year round. Builders refer to sunrooms as the poor-boy method of adding a room. It has many limitations. When you go to sell your home, the sunroom is considered an auxiliary structure (like a patio cover or a gazebo. It does not add legal sq. ft. to your home. In the age of efficiency and reducing output of energy, a sunroom is a proven inefficient structure. Not conducive as a bedroom, more like a game room, TV room, sewing room, den of sorts.
If you need more room in your home, build a “real’ addition. Permit it, Designate it, and ad it to the footprint of your home. The benefit to any room addition is its ability to be universal for multiple uses to be determined by you, not the manufacturer or contractor. Technically these rooms are notorious for roof leaks and excessive cooling costs. Sunroom projects have similarity to the home office as it also isolates the improvement, a potential tear down for new buyers choosing against this burdened room generally making it a bad selling point. No surprise, Remodeling magazine reports a national average for this project at $74,310 with a 45.9% return on investment (ROI).
Generally an expensive per square foot area to remodel. Not because of the construction but the high cost of finishes. Wall covering, tile, shower enclosure, cabinets, plumbing fixtures, and running water to name a few key components. Compare it to a bedroom or a closet which features none of these items and you get the idea. Ironically, the size of the bathroom you’re adding is not very influential on this ROI. Remodeling magazine reports this project’s national average at $40,096 with a 51% return on investment (ROI).
Auxiliary Power Generator.
This project is often found in areas susceptible to natural disasters that often interrupt electrical service to your home for a significant period of time. The cost of the installed generator with the ability to generate 70 amps of emergency power (2 – 240-volt circuits & 6 – 120-volt circuits) provides for a very poor ROI. Remodeling magazine reports this project’s national average at $14,760 with a 47.5% return on investment (ROI).
In the upscale projects category, Remodeling magazine reports Master Suites as a poor investment. The main reason is, once again, the cost of finishes included in this upscale project. Initial culprit is the master bath, but it’s quickly joined by closet interior design, fireplace, expensive casework, flooring, lighting, media center, etc. Remodeling magazine reports this large and costly project’s national average at $227,178 with a 50.5% return on investment (ROI).
And now for the good news… Here are the 5 best return on investment projects.
Front door replacement.
This average project cost is primarily dependent of the door you choose as a replacement. undisputedly, it is a project which adds curb appeal to your home in a very short time. Some door replacement also add a safety feature for prospective buyers if they are designed as a security door. The lock/deadbolt set will also set you back so if you are happy with your current hardware, leave it to gain better ROI. Utilizing a steel door for the average project cost, Remodeling magazine reports this national average at $1,137 with a 85.6% return on investment (ROI).
Two garage door are reported on to include the low cost, uninsulated, no windows, 4 panel track sliding door and the upscale, insulated, tempered windows, R-12 valued. Both doors assume a reattachment of an existing garage door opener.
This project also adds curb appeal to your home in a very short time. Seeing a pattern forming? It’s the show and not the function which pays back dividends on your investment.
Remodeling magazine reports this national average at $1,512 & $2,994 respectfully with a 71.9% & 71.1% returns on investments (ROI).
The idea for the cost savings is clearly in utilizing uninhabited space into a spare room and bathroom. It is a way to build something from an unused space. As a building inspector I will advise you against this project for many reasons related to structural safety as well as emergency exiting and evacuations (egress). Having said that, this blog is about ROI not personal safety.
Remodeling magazine designates this project as a 15×15 room conversion in an existing attic with an attached 5×7 bath. Utilities are extended from existing services.
This insane project reported by Remodeling magazine with a national average at $50,148 has a 72.5% return on investment (ROI).
Exterior Siding Replacement.
Replacement of old dilapidated siding to brand new fiber-cement siding, factory primed and factory painted adds that magic curb appeal I keep bringing up. Adding replacement of all 4/4 and 5/4 trim using either fiber-cement boards or cellular PVC also adds a waterproofing assurances, extended warranties and a sense of relief to a prospective buyer.
This replacement project assumes a 1,250 sq. ft. siding replacement as reported by Remodeling magazine with a national average at $13.461 has a 78% return on investment (ROI).
Minor Kitchen Remodeling.
The key to the ROI success of this project is to focus on the word “minor”. As you can imagine, kitchens are not cheap rooms to build. Actually, per square foot, a kitchen is the second most expensive room in your home (bathrooms are 1st). To achieve good ROI the following will be the scope of your minor remodel.
All fixtures remain in the same location. Sink, DW, Fridge, Oven, cooktop, etc. Cabinet layout does not change. Cabinet boxes remain unchanged. Upgrade fixtures and appliances wisely to efficient appliances and utilize available rebates. Replace all cabinet door fronts, new drawer faces, new hinges, new slides, new flooring, new counter, new paint. END!
If you stick to that, Remodeling magazine reports a national average at $19,588 for a minor kitchen remodel with a 72.1% return on investment (ROI).
Remodeling magazine’s extensive national and regional spreadsheet may lead you to the conclusion that the best ROI is not to invest at all, as all project yield less than 100% ROI. That is not what I’m advocating. Ongoing upkeep and maintenance are extremely important to homeownership. This ROI represents a tiny puzzle piece of a very large scope. Your home has lots of hidden value and perks which are not highlighted in this report. There are many benefits for self use out of projects you undertake for your home. The home office may only yield a 42% ROI but it saves you from having to lease commercial space for an office, pay utilities, and concern with excessive vehicle upkeep due to excessive commuting to and from work. These all have tangible value and it must be weighed in your decision to spend money on your home.
Total Comments 4
Posted 08-26-2013 at 03:53 AM by fiona123
Updated 10-15-2013 at 07:19 PM by TheEplumber (link removed)
Posted 08-26-2013 at 03:57 AM by fiona123
Updated 09-03-2013 at 05:17 AM by oh'mike (removed link)
Posted 09-24-2013 at 12:20 PM by GEOdiy
Posted 09-24-2013 at 12:24 PM by GEOdiy