The question posed in the title of this article can be answered very quickly, and the answer is yes. A kitchen remodeling will probably add value to your home. In fact, a kitchen remodel is one of the more efficient ways to do so. Unfortunately, there is no way to give you accurate numbers that will apply across all markets. Instead, let’s just take a general look at the subject so that you can decide if this kind of thing is worth your trouble. We will assume that this remodel is intended for a house that you are going to sell.
Use Good Business Sense
So, if you’re going to upgrade a home before selling it, you are obviously doing so for business reasons. You want the house to sell easier and for a higher price. However, you should remember these two key principles of business if you want to use these renovations to make a profit.
First, make sure that you know how much to mark up the cost of your home. For instance, if you spend $6,000 on a kitchen remodel, you should add at least $7,000 to the cost of the home. This is how you make a profit instead of just recouping your losses. If you don’t make a profit, there is truly no point in renovating.
Secondly, think more about appearance than substance. In order to justify the extra cost, the kitchen needs to look stunning. If it is impressive enough, people probably will generally be willing to pay a little bit more. Without this “wow” factor, they are unlikely to lay down the extra cash.
A Good Example
As we already mentioned, there is no way for us to give you accurate numbers across all housing markets. However, we can give you some approximate figures that will at least give you a ballpark estimate. We might start with this report from the National Association of Realtors.
We can learn a few good things from this report. First, we see that a majority of Americans say that they would rather remodel their home than buy a new one. This tells us that most homebuyers don’t mind a little bit of repair or maintenance. That’s even more reason to concentrate on the visual appeal of the place.
When we finally get to the important part of this report, we see that they have made a top ten list-two of them, actually. The first list ranks various home upgrades in terms of their general appeal to buyers. The other list ranks them by the amount of value they will add to your home. You will be happy to know that a full kitchen renovation is number one on both lists. This tells us that a full kitchen renovation will add more value and appeal to your home than any other. Bear in mind that this list was created based on a survey of many professional realtors, making it pretty trustworthy.
The Importance Of ROI
These three letters stand for return on investment and represent a common term in the realty industry. When you invest money into home renovations, you want to get that money back when you sell the home…preferably with a little extra! However, this will not happen if you spend too much on your renovations, and that is the main danger to avoid.
Let’s look at some more research. This one tells us that homeowners spend between three and four billion on home improvements every year. While these numbers are conflated to represent the entire nation, it gives you an idea of just how expensive these repairs can be.
You should only do renovations that have a high ratio of investment and return. If not, you are likely to lose money. Even if you only see a slight profit from a particular renovation, it probably wasn’t worth all that extra trouble. We have already seen that a total home renovation tops the list in this department, but let’s go back and see what else is on that list:
- Kitchen Upgrade
- HVAC Replacement
- Wood Flooring
- Bathroom Renovations
This is where we can truly see that kitchen improvement really is the best when you want to add value to your home. Even if we remove number one from the list, kitchen upgrades still come out on top. That means that a partial kitchen renovation is going to add more value than a complete HVAC replacement or a complete bathroom renovation.
How Much Will Kitchen Upgrades Cost?
Now you know how much value this kind of thing can add to your home. So, let’s try to get an idea of just how much your kitchen upgrades might cost. Obviously, the cost will mainly depend on the options and materials that you choose. However, we should be able to find some average figures. According to this estimate, you are looking at anywhere from $13,000 to $35,450. Of course, those who know how to make good use of their resources can probably get those numbers down a little bit lower. The use of secondhand materials might be an option, and you might also save some money by doing a portion of the labor yourself.
As we stated from the beginning, this is a hard subject to research. Every locality has a distinct housing market, and these markets are not often steady from year to year. Just trying to get accurate figures on a subject like that is mind-boggling, but we hope that we have at least given you the information you need to decide whether or not this particular investment is worth the money. As near as we can tell, remodeling or upgrading a kitchen is probably the single biggest way to add value to your home. If you have enjoyed this article, and if you would like to read more of our work, please feel free to fill out the contact form below.