It takes money to make money, as they say. When you’re getting ready to sell your home, spending some cash on home improvements now can pay off in a higher sales price when closing time comes. But not all repairs, fixes, and upgrades are created equal.
Not only do certain projects yield a higher return on investment (ROI), but listing language can impact sales performance, helping identify which modern-day features attract the most buyers. If you want to get the most bang for your home improvement buck, consider the following renovations and features to increase home value in 2020.
Calculating Your Home Improvement ROI
Calculating the ROI of a given improvement involves determining how much in costs you recoup after comparing the expense to the amount it adds to the sale price. The higher percentage of costs recovered means a higher ROI. According to Remodeling 2020 Cost vs. Value Report (www.costvsvalue.com), doing a minor kitchen remodel in a Chicago condo can cost, on average, $29,543 and add $21,250 to the sale price, meaning that the seller recoups 71.9% of the costs involved. Similarly, a mid-range bath remodel can cost $27,480 on average and up the sale price by $14,641, with 53.3% of the costs recouped.
In Chicago, other ROI home improvements that provide the best value for sellers include:
- Manufactured stone veneer: 90.5% of costs recouped
- Garage door replacement: 80.1% of costs recouped
- Window replacement: 71.5% of costs recouped
The National Association of Realtor’s 2019 ROI report reveals that nationally, sellers who undergo a minor kitchen remodel recoup 81% of their costs, while a mid-range bathroom remodel yields a 67% return.
Additional Renovations That Add Significant Value
In addition to the foregoing, listings that contain the following features see significant value-add in terms of sale price according to the Zillow survey:
- “Modern Farmhouse.” As “rustic chic” has become the go-to style on many home improvement shows, listings that boast about these design elements have typically sold for about 10% more than would have otherwise been expected.
- Waterfall countertops. Instead of stopping cold at the edge of a cabinet or island, a waterfall countertop drops vertically down the sides, creating a continuous flow that naturally links the floor to the cabinetry. Buyers are looking for this feature, which added about 9.4% more to the sales price than would have been the case without them.
- Moroccan tile. 3% higher sale price
- Craftsman-style homes. 6% higher sale price
- Exposed brick. 6% higher sale price
How To Finance Home Improvements
Many, if not most, of the best home improvements for resale can cost more money than folks have on hand. Fortunately, there are several financing options for such renovations that won’t cut into your ROI. These include:
- Personal Loan
- Home Equity Line of Credit
- Home Equity Loan
- Mortgage Refinance
- Credit Cards
- Government Loans (HUD, VA, etc.)
- Compass Concierge
If you are planning on selling your Chicago home or condo in the near future, reach out to one of the experienced agents at Z Chicago. They can help you through the process and offer guidance as to what repairs, improvements, and modifications can help you obtain the highest possible sale price. And, if you work with a Z Chicago agent, you can get your renovation costs paid upfront via Compass Concierge.