This is the third and final post in a series of blog articles focused on home remodeling costs. In the first and second articles, we shared how to prioritize your renovation wish-list to stay on budget and strategies that would enable you to save money while still ensuring a high-quality renovation. Here we discuss the value of your home remodel and what the cost means.
Budget is one of the top concerns when planning home renovations, and for some, how that budget relates to home value is very important. The relationship between the value and the remodeling cost is more complex than people think. When you remodel your home, you’re adding value to the home asset, but you’re also investing in you and your family to alleviate some pain or challenge that you’re experiencing.
The Annual Cost vs. Value Report
A useful tool for figuring out the possible value a project can add to your home is the annual Cost vs. Value report. It is a yearly set of remodeling estimates that have been released every December since 2002. Remodeling Magazine compiles the information they collect from realtors and a publisher of remodeling cost estimation tools. Then they determine the values of renovation projects for the preceding year.
The report is available online, and it’s easy to use. The archive goes back more than two decades, so if you are interested in previous year’s reports, you can find them easily. Remodeling Magazine also takes into account subjective factors like trends to gauge how the popularity of a project can affect its value.
However, there are a few things to keep in mind when using the report. Remember that it is designed as a tool to get an estimation of regional averages for project costs. No two remodels are identical. While the report is helpful, it should never be taken as an exact assessment.
Renovating your home is exciting, but be aware that the relationship between cost and value is not an equal one. If you are concerned about receiving a return on your investment, that relationship is something to consider before starting your project. A renovation project for your “forever home” will likely look a great deal different than renovations intended to prepare a home for market. Whether you are updating to move or settling in for the long haul, it’s hard to put a value on loving where you live.
We hope you found this series on home remodeling costs to be helpful! If you have any questions or would like to speak with us about your next home remodel, please contact us.