What Adds Value To A Home

It had been six months of dust, noise, and chaos, but Samantha and her husband finally stood back to admire their newly renovated kitchen. The sleek countertops gleamed, the open floor plan invited light to flood in, and the modern appliances added a sophisticated touch. Their old house had needed an upgrade to increase their comfort and boost its value for a future sale. The couple knew home improvements were an investment in their family’s future. What they did not expect was the first offer they received from a potential buyer just two days after listing—an offer 15% higher than what similar homes in the neighborhood were selling for.

Homeowners like Samantha understand that making the right upgrades can add value to a home. However, only some improvements have the same return on investment (ROI). Whether you plan to sell your home soon or want to enjoy the space and increase its value over time, this article will explore what adds value to a home based on market trends, expert opinions, and statistics.

Kitchen Renovations: The Heart of the Home

It is often said that the kitchen is the heart of the home, and this remains true when it comes to adding value. When done thoughtfully, a kitchen can offer one of the highest returns on investment. According to Remodeling Magazine’s 2023 Cost vs. Value Report, a minor kitchen remodel has an average return on investment of 85.7% (Remodeling Magazine, 2023). This includes upgrading appliances, refinishing cabinets, installing new countertops, and replacing old fixtures.

However, it is essential not to go overboard. Full-scale luxury kitchen remodeling may not significantly give you as much of a return as expected if it outpaces the value of other homes in your neighborhood. Experts suggest sticking to a budget proportional to your home’s overall value.

Key Stats:

Average ROI of a minor kitchen remodel: 85.7% (Remodeling Magazine, 2023)
The national average cost of a minor kitchen remodel: $26,214
Potential value-added: Up to 15% of your home’s value

Reference:

Remodeling Magazine. (2023). Cost vs. Value Report.

Bathroom Remodels: Small Space, Big Impact

Bathrooms, like kitchens, are spaces where homebuyers are particularly critical. A dated or worn bathroom can deter potential buyers, while a fresh, modern one can make a huge difference. According to the Cost vs. Value Report, a mid-range bathroom remodel has an average ROI of 67.5% (Remodeling Magazine, 2023). Upgrading the vanity, installing new tile, updating fixtures, and adding energy-efficient lighting can significantly boost your home’s value without breaking the bank.

Master bathrooms, in particular, are highly sought after, and if your home does not have one, adding a main suite could be a game-changer. Though costly, a main bathroom addition can yield an ROI of up to 56% (Zillow, 2022).

Key Stats:

Average ROI of a mid-range bathroom remodel: 67.5%
Average cost of a mid-range bathroom remodel: $20,538
ROI of a main suite addition: Up to 56% (Zillow, 2022)

Reference:

Remodeling Magazine. (2023). Cost vs. Value Report.
Zillow. (2022). Home Improvements That Add Value.

Curb Appeal: First Impressions Matter

The exterior of your home sets the tone for potential buyers the moment they pull into the driveway. Curb appeal is about making sure your home looks well-maintained and inviting from the outside. Simple upgrades like a fresh coat of paint, new landscaping, or a modern front door can offer significant value with a modest investment.

Exterior improvements often provide some of the highest returns. For example, replacing an old garage door has an ROI of 102.7%—the highest of any renovation project in 2023 (Remodeling Magazine, 2023). Meanwhile, improving your landscaping, adding a new front door, or installing outdoor lighting can boost your home’s appeal and overall market value.

Key Stats:

ROI of replacing a garage door: 102.7%
ROI of adding a new entry door: 60.9%
ROI of landscaping and curb appeal upgrades: 100-200% (HomeLight, 2022)

Reference:

Remodeling Magazine. (2023). Cost vs. Value Report.
HomeLight. (2022). The Ultimate Guide to Curb Appeal.

Energy Efficiency: Savings for You and Value for Buyers

In today’s market, energy efficiency is a significant selling point. According to a National Association of Home Builders (NAHB) survey, 91% of homebuyers want energy-efficient features, such as Energy Star-rated windows, appliances, and lighting (NAHB, 2021). Installing energy-efficient windows, improving insulation, or adding solar panels can not only lower your utility bills. At the same time, you live in the house but add significant value when it is time to sell.

Solar panels, in particular, are becoming a sought-after feature. A study by Zillow found that homes with solar energy systems sold for 4.1% more than comparable homes without solar (Zillow, 2021). While installing solar panels requires a significant upfront cost, this investment can pay off in savings and added value over time.

Key Stats:

ROI of installing energy-efficient windows: 68.6% (Remodeling Magazine, 2023)
Average increase in home value with solar panels: 4.1% (Zillow, 2021)
Percentage of homebuyers looking for energy-efficient features: 91% (NAHB, 2021)

Reference:

National Association of Home Builders (NAHB). (2021). What Buyers Want.
Zillow. (2021). The Impact of Solar Energy on Home Values.
Remodeling Magazine. (2023). Cost vs. Value Report.

Adding Usable Space: Square Footage Always Matters

In real estate, square footage is critical in determining a home’s value. Therefore, adding livable space—converting an attic into a bedroom, finishing a basement, or building a deck—can significantly boost your home’s value.

According to the Cost vs. Value Report, finishing a basement can provide an ROI of 70.4%. Attic conversions are also valuable, particularly if they add a bedroom or bathroom to your home. In some cases, an attic conversion can generate an ROI of 75.9% (Remodeling Magazine, 2023).

Outdoor spaces are another area where added square footage can pay off. Deck additions, in particular, remain widespread, with a composite deck addition providing an ROI of 45.6%. Outdoor living spaces have become desirable in the post-pandemic world, where more people are looking to maximize their homes for indoor and outdoor use.

Key Stats:

ROI of a basement remodel: 70.4%
ROI of an attic conversion: 75.9%
ROI of a composite deck addition: 45.6% (Remodeling Magazine, 2023)

Reference:

Remodeling Magazine. (2023). Cost vs. Value Report.

Smart Home Technology: Modern Convenience

Smart home features are becoming increasingly popular as technology plays a more significant role in our daily lives. From smart thermostats to security systems, buyers often pay more for homes with modern conveniences controlled by smartphones.

According to a Coldwell Banker study, 44% of homebuyers believe that smart home technology makes a home more desirable, and 54% would choose a home with innovative technology over one without if both were similarly priced (Coldwell Banker, 2022).

Key Stats:

Percentage of buyers interested in smart home technology: 44%
Percentage of buyers willing to pay more for smart home features: 54% (Coldwell Banker, 2022)

Reference:

Coldwell Banker. (2022). The Smart Home Survey.

Conclusion: Invest Wisely for Maximum Return

Whether you want to sell your home or enjoy the benefits of a more comfortable and modern living space, making strategic improvements can significantly add value. From kitchen and bathroom remodels to energy-efficient upgrades and added living space, each renovation can play a vital role in increasing your home’s market value. However, planning carefully and considering your enjoyment and the potential return on investment before embarking on any major renovation project is essential. By focusing on the upgrades that matter most, you can ensure that your home becomes a better place to live and a more valuable asset for the future.