Those who are looking to add value to their home should be focusing outside. According to Remodeling magazine's 20th annual "Cost vs. Value Report". Realtors in 65 markets were given construction specs and costs on 29 upscale and midrange projects and asked to estimate the percentage return at resale. The only interior remodel to reach 80 percent recovery in 2007 was a minor kitchen remodel. Other projects that beat the 80 percent mark were siding, deck additions, and window replacement.
In general, remodeling returns have gone down due to rising remodeling costs and slowing home appreciation. Except, of course, for the Pacific region which includes Alaska, Hawaii, Washington, Oregon and California. In this area there were actually six projects that saw an estimated return of over 100 percent. Those remodels were wood deck additions, minor kitchen remodels, fiber-cement siding replacement, wood window replacement, and an upscale wood and vinyl window replacement.
While the report does give national numbers it also breaks it down by region because where you live clearly influences what is valuable to buyers. For example, adding on an midrange garage will see an estimated 88 percent return here but in West North Central, which includes the states of IA, KS, MN, MO, NE, ND, and SD, they could only expect about 57.9 percent back.
Revamping an attic bedroom could get you 98 percent on the west coast while the national percent is around 76.6 percent. Adding an upscale bathroom to your home has an estimated national average of a 69 percent return but the Pacific region is thought to be more like 84.1 percent. Of all the areas in the country that a home owner could be doing a remodel, our area is certainly the safest bet if you are doing it for the resale value and not for yourself.
Realtor Magazine - December 2007 - "Payback Time" page 32
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