Real Estate Blog

I wrote about this in the past, but here is an updated version containing some new things that I have experienced the past few months.
There are two ways to go about making home improvements. Either you splurge for something purely for the sybaritic pleasure of having it — the Italian marble bathroom you’ve dreamed about; that skylight that your spouse has been hinting at for the last six years — or you take a pragmatic approach, buying an energy-efficient furnace or repairing a leaky roof because you want to increase your home’s market value.
Exactly how much you’ll recoup in costs depends on several factors, including the direction of the broader housing market, the value of the homes in your neighborhood, when you plan to sell the home and the nature of the project itself.
Kitchens
Even a few basic improvements to your kitchen can pay handsome dividends, says real-estate agent Michael Murphy in his book “How to Sell Your Home in Good or Bad Times.” Murphy writes: “For most buyers, [the kitchen] is the heart of the house. Paint, wallpaper, and even refloor the room if necessary. Consider sanding, staining or painting dingy-looking cabinets. Replace old cabinet hardware — a low-cost improvement that makes a big difference in appearance.” Just be sure to go with a classic design and, if possible, use high quality materials, says Remodeling magazine’s Cory. After all, good taste endures.

The average amount spent on a major kitchen-remodeling job in the U.S. is $54,241 for a midrange update; an upscale designer makeover averaged $107,973, according to Remodeling magazine. The midrange kitchen overhaul nationally recouped 80% of its cost and 76% of the costs were recovered in an upscale makeover.

Creating New Space
As a rule, improvements that increase the functional space of a home hold their value longer than ones that just make a house look better. It’s also significantly cheaper than adding an addition to your home. Converting an attic into a bedroom, for example, usually costs about $35,960 and returns about 80% of its cost, according to Remodeling magazine. Turning your basement into a room for socializing will set you back, on average, $56,724, and allow you to recoup 79% of your costs.

An Extra Bathroom
Adding an extra bathroom with all the trimmings — marble vanity top, molded sink, bathtub with shower and ceramic tile — almost pays for itself. A midrange full-bath remodeling job in the U.S. has an average price tag of $12,918 and recoups 85% of the costs. A midrange full-bath addition has a national average cost of $28,918 and generally recoups 75% of its cost.
Decks
Installing a deck may be the most cost-efficient way to add square footage to your house, and of all the outdoor home improvements except painting, it may be the most reliable value. Deck additions average $14,728 and generally recoup 77% of their value. That may not sound terribly impressive, but other touted outdoor improvements fare much worse.
New Windows
The savings on your utility bill might make up for the spotty resale value. Replacing 10 three-by-five-foot windows with insulated wood replacement windows typically costs $9,416 and recovers more than 85% of its costs at resale, according to Remodeling magazine.

STAY AWAY from investing money into Manicured Gardens and Swimming Pools, they almost have no resale value at all, and you will be spending anywhere between $40k-$60k.