The Top 5 Home Remodeling Investments

Have you wondered what a remodeled kitchen, bathroom, or deck brings to a home in terms of return on investment?  Check out the ranking from Remodeling Magazine’s 2010 Cost vs. Value Annual Report.  This year’s report includes 18 of the most popular home remodeling projects, their average Bay Area cost, resale value, and recoup percentage.

Where They Got the Data

Cost data for the report came from Home-Tech Information Systems, a remodeling estimating software company that collect current cost information quarterly from a nationwide network of remodeling contractors.

Resale value of each remodeling project is based on the professional judgment of members of the National Association of Realtors (NAR).  E-mail surveys containing cost and median home price data were sent to more than 20,000 appraisers, sales agents and brokers nationally.  The survey was broken out by region, with the data used here coming from the Northern California Bay Area.

I have ranked them by their order of percentage cost recouped.


PROJECT 2010  







1 FRONT ENTRY DOOR REPLACEMENT $1,464 $1,641 112.1%
2 GARAGE DOOR REPLACEMENT $1,541 $1461 96.4%
3 DECK ADDITION (WOOD) $13,827 $11,956 86.5%
4 MINOR KITCHEN REMODEL $23,603 $19,854 84.1%


$14,431 $12,061 83.3%
6 WINDOW REPLACEMENT (VINYL) $13,401 $10,760 80.3%
7 BATH REMODEL $19,490 $15,515 79.6%


$17,552 $13,878 79.1%
9 MAJOR KITCHEN REMODEL $65,686 $50,556 77%
10 TWO STORY ADDITION $195,228 $141,181 72.3%


$13,980 $10,067 72%
12 FAMILY ROOM ADDITION $105,369 $89,058 71.1%
13 MASTER SUITE ADDITION $131,566 $89,058 67.7%
14 ROOFING REPLACEMENT $26,718 $17,499 65.5%
15 GARAGE ADDITION $73,834 $48,204 65.3%
16 BATHROOM ADDITION $49,508 $31,302 63.2%
17 HOME OFFICE REMODEL $32,428 $17,641 54.4%
18 SUNROOM ADDITION $86,970 $47,319 53.3%


With 4 of the top 5 value yielding projects being exterior projects, it’s safe to say that in today’s home price economy, curb appeal is now king!


Let’s look at the reasons:


In an economy where “frugal” is the word, each of the exterior projects comes in less than $15,000.  The project with the greatest return, a mid-range entry door, costs less than $1,500.


Exterior improvements contribute to the overall look and feel of a home.  That is especially true in a market with more sellers than buyers.  Often when a home’s exterior looks less-than-stellar, would be home buyers will tell the realtor to “keep on driving.”  With the exterior updated, potential buyers can concentrate on other parts of making the house their home.


Another big reason for the popularity of exterior home projects is energy efficiency.  Not so important before, definitely important now.  Chalk some of that up to tax credits now available for energy-efficiency upgrades, like siding and windows.  Some potential homebuyers not only want a good-looking house, they want an energy efficient one.  That’s because homeowners are now more aware of the fact those windows, roof, or siding can save them money in the long run by offsetting energy costs.

Turnkey is Key

When the Bay Are real estate market was at its peak in the mid-2000’s, buyers were willing to invest time and money into their new homes appearance.  It was part of the long-term cost of the transaction.  In a buyer’s market, like we have today, the opposite holds true… the well cared for homes are the ones selling.  One Fremont, California realtor commented that she brought her client into a 50 year old home priced at $460,000.  “The house was older and the kitchen hadn’t been updated since the 70’s,” she says.  “But though it wasn’t stylish, what it did have going for it was the owner had maintained it well.  It was well kept. The roof was in great shape, and it had new windows and gutters.  The house was under contract in three days.”