Home Renovations and ROI: What You Need to Know

Is 2023 the year you will tackle that home renovation project? If so, you might be determining the scope of your budget. How far will your demolition extend? What kinds of finishes will you choose? Will you do the work yourself or will you hire a professional builder? With all these things in mind, it is important to understand how your home renovations will pay off in the future. Choosing renovations that deliver high returns on your investment is a crucial yet difficult goal. Ahead, we will discuss some guidelines to help you stay focused. Keep Up with the Joneses While most financial planners will tell you not to cave to peer pressure, in the case of real estate, you should. Your home renovations must stay in line with your neighborhood. Comparing your renovation designs to homes in your neighborhood is an important market factor. Your renovations should be functional, and updated, but not exceed the general price points and aesthetics for homes in your area. Do not price yourself out of the neighborhood you live in. If your goal is more space with your renovation, be certain your new addition does not alter the overall appearance of your home. You do not want to live in the house with the big box hanging off the side or back of it as buyers drive down the street. Consider Your Timeline If you want to renovate and then live in your home, beware your style choices could be dated by the time you want to sell. Experts refer to this concept as “stylistic depreciation.” Homeowners making renovations with a timeline of 10-20 years should choose classic styles and finishes that last. If your goal is to renovate to sell immediately, you can choose a trendier palette that will resonate with current buyers. Expect the Unexpected when Renovating If your renovation budget is tight and estimated to barely pay itself back upon your home selling, be prepared for unexpected expenses to arise. If something can go wrong during a home renovation – it will. Cutting your project down so there is a cushion between what you can afford and how much the project costs to complete is recommended. The best advice is to complete your home renovation project based on what you can afford. Cutting corners and making decisions based on future returns could lead to a negative return on dollars and happiness. The Best Home Renovations for Your Money In general, any home renovation project that adds space and function to your current square footage is a good ROI bet. Experts suggest renovating your kitchens and bathrooms first because they are the most used spaces in your home, but they caution these are also the most expensive spaces to update. The second most sought-after renovation project is a finished basement followed by enhanced exterior improvements for curb appeal. Exterior upgrades encompass a wide array of renovations from new windows to vinyl siding and roofs. If you live in the Kelowna B.C. area and are looking for a professional builder to guide you through the renovation process, please contact LUX Homes for more information.