Despite a slow market and a slight decrease in the resale value of
most remodeling projects, Realtors® report that the smartest home
improvement investments may also be some of the least expensive.
Results from the 2009 Remodeling Cost vs. Value Report show that
small-scale exterior projects are the most profitable at resale,
according to estimates by Realtors® who completed a recent survey.
On a national level, eight out of the top 10 projects in terms of
costs recouped were exterior replacement projects that cost less than
$14,000. Certain types of door and siding replacements, as well as wood
deck additions all returned more than 80 percent of project costs upon
resale. A steel entry door replacement – a new addition to this year’s
list – recouped 128.9 percent of costs, followed by upscale
fiber-cement sliding replacements at 83.6 percent. Wood deck additions
recouped 80.6 percent of costs.
“Once again, this year’s Remodeling Cost vs. Value Report highlights
the importance of a home’s first impression,” said NAR President Vicki
Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz.
“With exterior projects returning a high percent of project costs upon
resale, Realtors® can help give your home curb appeal while adding
value to the real estate transaction.
The 2009 Remodeling Cost vs. Value Report compares construction
costs with resale values for 33 midrange and upscale remodeling
projects comprising additions, remodels and replacements in 80 markets
across the country. Data are grouped in nine U.S. regions, following
the divisions established by the U.S. Census Bureau. This is the 12th
consecutive year that the report, which is produced by Hanley Wood,
LLC, was completed in cooperation with REALTOR® Magazine, as Realtors®
provided their insight into local markets and buyer home preferences
within those markets.
On a national level, the project with the biggest improvement from
2008 was the attic bedroom addition, recouping 83.1 percent of
remodeling costs compared to 73.8 percent in 2008. The only other
interior project that landed in the top 10 was a minor kitchen remodel
with 78.3 percent costs recouped.
Other exterior projects in the top 10 include midrange vinyl and
upscale foam-backed vinyl sliding replacements, which returned more
than 79 percent of costs. In addition, several types of window
replacements – midrange wood, midrange vinyl, and upscale vinyl – all
returned more than 76 percent of costs upon sale.
Similar to last year’s report, the least profitable remodeling
projects in terms of resale value were home office remodels and sunroom
additions, returning only 48.1 percent and 50.7 percent of project
costs.
Regionally, cities in the Pacific states of Alaska, California,
Hawaii, Oregon and Washington once again outperformed the rest of the
nation in terms of remodeling costs recouped upon resale. The West
South Central region of Arkansas, Louisiana, Oklahoma, and Texas; the
East South Central region of Alabama, Kentucky, Mississippi and
Tennessee; and the South Atlantic region of the District of Columbia,
Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia
and West Virginia also performed relatively well.
The regions that generally returned the lowest percentage of costs
were New England (Connecticut, Massachusetts, Maine, New Hampshire,
Rhode Island and Vermont), East North Central (Illinois, Indiana,
Michigan, Ohio and Wisconsin), West North Central (Iowa, Kansas,
Minnesota, Missouri, Nebraska, North Dakota and South Dakota), and the
Middle Atlantic (New York and Pennsylvania).
Golder commented that remodeling projects are just one of many
factors that contribute to a home’s overall resale value. “As the
first, best source for real estate information, Realtors® are experts
in providing insight into what projects and investments will make a
difference in your house. It’s important to consult with a Realtor® who
can explain the variety of factors that affect a home’s value, such as
location, condition of surrounding properties and the regional economic
climate,” she said.
Results of the report are summarized in the January issue of
REALTOR® Magazine. To read the full project descriptions, access
national and regional project data, and download a free PDF containing
data for any of the 80 cities covered by the report, visit www.costvsvalue.com. “Cost vs. Value” is a registered trademark of Hanley Wood, LLC.
Hanley Wood, LLC, is the premier media company serving housing and
construction. Through four operating divisions, the company produces
award-winning magazines and Web sites, marquee trade shows and events,
rich data, and custom marketing solutions. The company also is North
America’s leading provider of home plans. Founded in 1976, Hanley Wood
is a $240 million company owned by JPMorgan Partners, LLC, a private
equity affiliate of JPMorgan Chase & Co.
The National Association of Realtors®, “The Voice for Real Estate,”
is America’s largest trade association, representing 1.2 million
members involved in all aspects of the residential and commercial real
estate industries.
Realtors.org. 2/4/2010. Leanne Jernigan