- Realtors® bring value to sellers; they can provide insights into what remodeling projects and improvements will make a difference in local markets.
- According to the 2014 Remodeling Cost vs. Value Report, Realtors® rated exterior replacement projects among the most valuable home improvement projects.
- Realtors® know that curb appeal projects offer great bang for your buck, because a home’s exterior is the first thing potential buyers see.
- Overall, Realtors® in 100 markets estimate an average 66.1 percent cost recouped on 35 midrange and upscale remodeling projects, including additions, replacements and remodels. For the second consecutive year, the value of remodeling is also up for all the projects included in the report.
- A majority of the top-10 most cost-effective projects nationally in terms of value recouped are exterior replacement projects; all of these are estimated to recoup more than 78 percent of costs. Data shows replacement projects recoup more upon resale than remodeling projects, likely due to their lower cost.
- Realtors® judged a steel entry door replacement as the project expected to return the most money, with an estimated 96.9 percent of costs recouped upon resale. It is also the least expensive project in the report, costing little more than $1,100 on average.
- Various types of siding and window replacement projects were expected to return more than 78 percent of costs.
- Top interior projects for resale value include an attic bedroom and a minor kitchen remodel. All are expected to return more than 82 percent of costs upon resale.
- The improvement project that was expected to return the least value upon resale is a home office remodel with an estimated 48.9 percent of costs recouped.
- The desirability and resale value of different remodeling projects varies by region and metropolitan area.
- Realtors® are the best source of real estate information and can explain the variety of factors that affect a home’s value, such as location, condition of surrounding properties and regional economic climate.
- Realtors® have invaluable insights into what sells a home. They visit hundreds of homes with buyers each year and have a unique understanding of what home buyers value in their local markets.
- When considering a remodeling project or preparing a home for sale, consumers should rely on industry professionals, such as Realtors®, who have the expertise and experience to help homeowners protect their investment.
- Realtors® have a unique understanding of local markets, home features and buyer preferences.
- According to the NAR Profile of Buyers’ Home Feature Preferences, today’s buyers want air conditioning, walk-in closets, and homes that are wired for Internet, cable and satellite TV.
- Many buyers want newer homes (less than five years old) and would like to live near a body of water; buyers are willing to pay more for these features.
- The rooms in a home that buyers are willing to spend more money for are a laundry room and a den/home office.
- A majority of buyers think a living room is the most important room in a home.
- Repeat buyers, buyers of new homes, married buyers and those with children typically purchased larger homes. First-time buyers and single female buyers tended to buy older homes.
- Single female buyers placed a higher importance on a single-level home, while single males placed higher importance on having new kitchen appliances. Single males were more likely to want a newer home and for that home to have cathedral ceilings.
- More than half of buyers surveyed undertook a home improvement project within three months of their home purchase; the typical buyer spent $4,550 on projects, and the kitchen was the most common improvement area.
- Although an overwhelming majority of recent buyers were satisfied with their home purchase, many would have preferred more or larger closets and additional storage.
For 16 years, the National Association of Realtors® and REALTOR® Magazine have been collaborating with Remodeling magazine publisher Hanley Wood, LLC, on its Cost vs. Value Report, an annual overview of the costs of different home remodeling projects and their resale value in local markets across the country. Realtors provide their insight into local markets and home buyer preferences in 100 cities across the country for the report. The report compares construction costs with resale values for 35 midrange and upscale remodeling projects.
2014 National Averages
Top Five Projects
|Project||Job Cost||Resale Value||% of Cost Recouped|
|Entry Door Replacement (steel)||$1,162||$1,122||96.6%|
|Deck Addition (wood)||$9,539||$8,334||87.4%|
|Siding Replacement (fiber-cement)||$13,378||$11,645||87%|
|Garage Door Replacement (midrange)||$1,534||$1,283||83.7%|
The Cost vs. Value Report provides an accurate snapshot of the national housing market, but it can’t be applied accurately to an individual remodeling project for a particular address. Resale value is one factor among many that home owners must consider when making the decision to remodel. Although the costs used in the report are based on itemized estimates, the projects are hypothetical. When comparing the data to actual remodeling costs in a specific area, small differences in the scope of a project or quality of finishes and accessories can dramatically affect the price.
To read the full project descriptions and access national and regional project data visit www.costvsvalue.com.
NAR’s 2013 Profile of Buyers’ Home Feature Preferences examines the features buyers prefer when purchasing a home, as well as the differences in preferences when it comes to factors such as region, demographics and household composition. The survey captures buyers who purchased a home between 2010 and 2012.
The typical recently purchased home was 1,860 square feet and was built in 1996. The typical buyer purchased a home with three bedrooms and two full bathrooms.
Buyers in the Midwest
- Prefer homes with a garage.
- Consider a home with a basement very important.
Buyers in the Northeast
- Prefer homes with hardwood floors.
- Consider a home with a dining room very important.
Buyers in the South
- Tend to buy newer homes.
- Consider central air conditioning a very important home feature.
Buyers in the West
- Tend to buy single-level homes.
- Tend to purchase a home with no half bathrooms.
Related Talking Points
- Home Buying Tips
- Home Selling Tips
- Realtors® Add Value