Remodeling Cost vs Value Report 2011
Remodeling Magazine has issued its 2011 “Remodeling Cost Value Report.” This report is designed to give homeowners and contractors a breakdown of the return they can expect from their home remodeling projects and how that return will affect the overall resale value of their home. This report is released each year and often contains information about new remodeling trends which help homeowners understand what potential home buyers are expecting to see in an up-to-date property. Projects are broken down by type (kitchen, bath, exterior), cost (affordable, mid-range, upscale) and expected return.
Overall cost versus value is presented in this report and shows trends for the last eight years. For 2011, indications are that construction material costs will remain slightly elevated and overall remodeling value will remain slightly lower compared to returns gained during the height of the housing market. While this seems to be a negative trend on the surface, it actually indicates improvement in the overall landscape for home remodels and renovations. Home resale values and construction costs are starting to even out as the market gradually gains in stability.
Smaller projects and essential replacements still dominate the type of remodels and renovations that home owners are choosing. This is a smart choice in a cautious market as home owners may have to wait a few years before seeing the kind of return on investment they would expect. The data does indicate a slight up-tick in larger, more aesthetically focused projects in areas like kitchens and baths as more people choose to stay home and seek ways to create spaces they enjoy spending large amounts of time in. This trend is what also supported the inclusion of garage door replacements in the report as people have found that this is a low-cost, high-impact way to add visual appeal to their home’s exterior.
The report also notes that in some markets, homeowners should expect to see lower returns as the market remains cautious. For example, window replacement projects typically run between $11,000-12,000 in actual cost and homeowners can expect to recoup $7,000-8,000. This represents a decline of about 1.5% in return on investment. However, that’s still relatively high when compared with more upscale remodels and renovations such as adding a new bathroom which costs on average $78,000 and results in a return of only $41,000.
The report breaks down projects on a regional basis so that homeowners across the country can understand what to expect from their surrounding market. View the map here.
Information presented as compiled in the Remodeling 2010-11 Cost vs. Value Report (www.costvsvalue.com)