Written by Nicole Johnson
Home renovations can increase or decrease a home’s value, and to gain an idea of what renovations will do for your home’s worth, it’s vital to understand the local housing market. Going overboard on renovations by improving above what’s appropriate for the surrounding homes and area can cost you.
Remodels and improvements can boost a home’s return on investment (ROI). Some of the upgrades that generate the greatest ROIs and cost recoup include projects that increase efficiency and lower bills like window replacement, those that provide more livable square footage for relaxation like deck additions, and those that increase one of the home seller’s greatest tools—curb appeal—such as front entry door replacement.
With an increase in home prices in many areas of the country during the pandemic, many homeowners have listed their homes. They’re also enlisting the help of professionals to complete home renovations that will help increase their home’s value and get their homes sold.
To help homeowners get an idea of what home renovation projects will be the most valuable, Extra Space Storage analyzed data from Zonda Media’s 2021 Remodeling Cost vs. Value Report to determine the ten home renovation projects with the highest percentage of their job costs recouped, or the highest return on investment.
To determine the 2021 results, the report used data from 2017-19 on common projects done by about 200,000 home renovation professionals and that can be priced accurately, which is why products with specific styles or finishes or projects whose price is determined by specific region or climate are not included. The analysis applies a statistical model to the older data that’s based on recent construction cost estimates and economic indicators—such as income, employment, and market housing—to create the best 2021 estimate of a renovation project cost and its resale value.
10. Deck Addition (Composite)
- Percentage of cost recouped: 63.2%
- Average cost: $22,426
- Average resale value: $14,169
While composite decking carries a steeper price tag than wood decking, it’s a worthwhile investment. Not only does it resemble natural wood, but it’s also much easier to clean and maintain. Adding this type of decking provides a livable outdoor space for relaxation and dining, but it’s important to hire a professional and to secure a building permit. Doing a deck layout/footprint using stakes and string is a great way to make sure the deck will be exactly where you want it. The main costs associated with this project are the decking materials and labor costs. Most small to average-size decks can be completed in under a week, though decks with multiple levels or additional features can add to the renovation time. Composite also does not rot, crack, or splinter, and it comes in many textures and colors.
9. Entry Door Replacement (Steel)
- Percentage of cost recouped: 65%
- Average cost: $2,082
- Average resale value: $1,353
Replacing an entry door can be an important investment when selling because it’s the first thing buyers see as they enter a home. It’s rare to be able to complete a project that adds value to your home in such a short amount of time so inexpensively. Entry doors often come pre-hung and can be installed as a do-it-yourself project or with the help of a professional. Steel is both strong and durable and does not warp or crack under pressure. The project can usually be done in a day or two and includes taking several measurements, including jamb width, rough opening, and exterior opening, and removing the old door and trim before installing the replacement door.
8. Deck Addition (Wood)
- Percentage of cost recouped: 65.8%
- Average cost: $16,766
- Average resale value: $11,038
When deciding which type of material to use for a deck addition, it’s important to consider the climate, budget, and intended use. There are also many types of wood to choose from, each offering pros and cons. While pressure-treated wood handles stains and waterproofing well, it also requires a fair amount of cleaning and care, including frequent restaining or resealing and deck boards can crack and splinter. Cedar and redwood are easy to work with and offer insect resistance, but these materials aren’t available everywhere and can require significant upkeep. According to HGTV, the recoup rate varies, with the South seeing a smaller recoup at about 83%, while in the West, this sort of renovation sees a near 100% recoup rate.
7. Window Replacement (Wood)
- Percentage of cost recouped: 67.4%
- Average cost: $23,219
- Average resale value: $15,644
Wood replacement windows offer a significant amount of customization and can offer a modern, historic, or traditional look. Adding aluminum cladding to wood window exteriors offers additional protection from rot, moisture, termite damage, and decay. Non-clad windows often offer a shorter warranty, normally five years, and will rot if not maintained. Deciding which wood is best for your home can involve many factors, including style, durability, and budget. Pine is an inexpensive option, but it can easily scratch and dent.
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6. Siding Replacement (Vinyl)
- Percentage of cost recouped: 68.3%
- Average cost: $16,576
- Average resale value: $11,315
Vinyl siding is known for its durability and affordability. It’s much more budget-friendly than wood siding, stucco, or fiber cement, and it doesn’t rust, chip, or rot. It was first introduced in the 1950s as a replacement alternative for aluminum siding. As vinyl is able to expand and contract in hot and cold weather, installers should hang it allowing room for the siding to move when temperatures change. This type of siding can stand extreme winds as well and can also be recycled at the end of its life because it is a durable thermoplastic, making it an eco-friendly siding option.
5. Window Replacement (Vinyl)
- Percentage of cost recouped: 68.6%
- Average cost: $19,385
- Average resale value: $13,297
Overall, window replacement, no matter the type, can increase curb appeal and improve energy efficiency to lower a home’s heating and electrical costs. Replacement windows are an appealing feature to home buyers and are worth the investment. Vinyl is a cost-effective replacement option because these windows won’t rot or warp. Made from the very durable, polyvinyl chloride and other components, vinyl prevents ultraviolet light from deteriorating the frame. While vinyl normally has a hollow core, it’s possible to buy frames with additional insulation provided using a foam filling. Many other things will affect the bottom line for your replacement windows, including quality, brand, size, job difficulty, warranty, window features, and the area of the country in which you live.
4. Siding Replacement (Fiber-Cement)
- Percentage of cost recouped: 69.4%
- Average cost: $19,626
- Average resale value: $13,618
According to This Old House, fiber-cement siding performs like masonry with little upkeep; is fire, rot, and termite-proof; is unaffected by the elements like cold and wind; and it can look like shingles, wood clapboard, brick, or stone. This siding is also much more budget-friendly than these often expensive siding materials. A type of concrete siding, fiber-cement is made up of water, wood pulp, fly ash, and portland cement. Defect warranties can range from 25 years to limited lifetime, and fiber cement has to be stained or painted, which can be done before or after install. Not only can fiber-cement siding replacement increase your home’s value, but it also raises your home’s curb appeal.
3. Minor Kitchen Remodel (Mid-Range)
- Percentage of cost recouped: 72.2%
- Average cost: $26,214
- Average resale value: $18,927
A minor kitchen remodel can improve the look of your home without tearing down walls and doing a major renovation. Minor improvements can include upgrading appliances, refinishing old cabinets, and adding new hardware. Redoing floors and updating countertops with more attractive or durable ones can add significant value to your home and be appealing to buyers. For mid-priced homes, a minor kitchen remodel has a greater return on investment than a major kitchen remodel, according to Zonda Media’s 2021 Remodeling Cost vs. Value Report. Before making such a significant investment, it’s worth taking the time to figure out how much this kind of renovation project will increase your home’s value. This can depend on the area you live in and other factors.
2. Manufactured Stone Veneer
- Percentage of cost recouped: 92.1%
- Average cost: $10,386
- Average resale value: $9,571
Manufactured stone veneer adds a unique touch of elegance and loads of curb appeal to a home. This type of siding is durable and long-lasting, with many manufacturers’ warranties ranging from 20–75 years. Offering more fire-resistance than vinyl or wood siding, manufactured stone veneer is also maintenance-free. This artificial stone is made from a mixture of pigments, natural aggregates, and cement. Installation can be done one “stone” at a time or in small panels, and the artificial version is more cost-effective than natural stone with both labor and material costs.
1. Garage Door Replacement
- Percentage of cost recouped: 93.8%
- Average cost: $3,907
- Average resale value: $3,663
One of the easiest and most inexpensive home renovation projects—garage door replacement—also contributes to curb appeal. It’s also a very quick renovation project. Garage door replacement takes about four to six hours from start to finish. To save time and money, reuse your current motorized opener and wiring. The recoup of the project is almost equal to the cost of the project itself, which makes it a great home investment and one that will go a long way toward selling a home.