We live in a society of constant betterment….renovations are commonplace. Some renovations come about based on need, like more space for a growing family, but many are justified by an assumed return on investment in a hot housing market. So how do you know the difference between smart renovations and ones that just empty your wallet?
Smart renovations for the best return on investment
Focus on the basics. While a gorgeous kitchen or a glittering bathroom can draw most buyers in, what keeps them around are the basics. Buyers want to be sure that they home they are buying, and ultimately investing in, is in good condition. In simple terms, they don’t want to pay for a new roof or furnace in 6 months. These are the items that get highlighted in a home inspection and can ultimately make a conditional sale fall apart.
Inexpensive renovations don’t equal cheap. Many people mistakenly assume that a renovation needs to be expensive. Simple upgrades like painting a room, installing an inexpensive, yet modern light fixture, upgrading door handles or installing crown molding can have a huge impact on the overall feel of a room and are typically DIY-friendly.
Tried and true kitchen & bathroom renovations still draw a great ROI. When looking for a new home, most buyers keep an eye to the state of the kitchen and bathrooms, knowing that full blown renovations are an investment. With that being said, a mini-makeover of a room already in good shape can be a cost effective way to keep buyers from running in the other direction. Outdated cabinetry can be refaced or repainted for a fraction of the cost of replacing. Similarly, the addition of new hardware, sink and faucet can go a long way in providing the elusive bling that so often accompanies new kitchens and bathrooms.
Your curb appeal can be the differentiator. The exterior of a home is a great place to use smart renovation dollars. Well thought out plantings or a new front door (or glass insert) are inexpensive improvements that instantly make your house stand out from the rest. Decks or patios that welcome entertaining, while more expensive, expand the living space of a home.
Basements, when done right, will pay off. Many of us are not skilled enough to tackle a basement reno on our own, so this is one area we would highly suggest you leave to the pros. While a handyman special will save you money, it could also cost you money. Consult a designer or sit down with the friendly folks at your neighbourhood big box store (think Home Depot or Lowe’s) to ensure you’re making the best use of your space.
What smart renovations have you done that have given you the best return on investment? The Appraisal Institute of Canada has a list of smart renovations that will offer some good insight into what property appraisers look for.