Will that remodel pay off? The projected payback for projects
There was good news for the Boston metro area: Fifteen out of the 20 projects had a higher cost-recouped percentage than the national percentage.
Not all remodeling projects are created equal. In fact, some may help you resell your house more than others.
In its annual Cost v. Value report, Remodeling magazine tracked the price and payoff for 20 of the most popular professional projects (midrange and upscale) in 100 US markets for 2017.
Craig Webb, editor in chief, noted that this year’s report found that upscale and big projects are providing less value than they did in previous years and that the cost of remodeling projects went up 4 percent to 7 percent nationally, he said.
Webb said his team came up with 20 theoretical remodeling projects and then used RemodelMAX, a cost-estimation tool, to figure out what the construction price for each would be in 149 US markets. (They later narrowed down the list to 100.) The 20 projects ranged from a bathroom addition to garage door replacement to a minor kitchen remodel.
“After that, we reached out to real estate professionals across the country,” Webb said. “We said, if this project was done in your market and you sold the house within a year of when the project was completed, how much would this project add to the value of the house at resale?” Webb said his team then calculated the percentage of the cost recouped upon resale.
“The notable changes we saw at first is that some of the high-end projects did not gain as much in value this year,” Webb said. “In fact, many of them went down compared with last year. The value side of cost versus value is very much tied to the real estate market.”
The report notes that the cost og doing all 20 projects increased, while the resale value rose for only two-thirds of them. In 2016, the average return on investment for the 20 different remodel projects was 57.9 percent, while in 2017 that number fell to 56.8 percent. There was good news for the Boston metro area, however: Fifteen out of the 20 projects had a higher cost-recouped percentage than the national percentage.
In this year’s report, Webb also found that, nationally, exterior projects had a higher cost-recouped percentage than interior ones. The three projects with the highest percentage were replacing garage doors (98.3 percent), installing a manufactured-stone veneer (97.1 percent), and adding a wood deck (82.8 percent).
Here is a sampling of the report’s Boston findings:
- Cost recouped on a midrange major kitchen remodel: 63.6 percent
- Cost recouped on a midrange bathroom remodel: 72.5 percent
- Cost recouped on a roof replac ement: 69.2 percent
- Cost recouped on adding a patio: 48 percent
- Cost recouped on window replacement: 75.4 (vinyl) and 76.1 (wood)
More and more people are living longer in their homes, Webb said. “Consequently, it is more and more likely that remodeling will become more of your life.”
You can find more Boston-specific information about remodeling projects in the full report.
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