Home Improvement and the Real Estate Market

Home improvement is the process of renovating and making additions to one’s home. It can be done for a variety of reasons, such as upgrading worn out surfaces and finishes, adding personal touches, or increasing the functionality of the home. Regardless of the reason, home improvements can increase both the comfort and value of the home. The home renovation industry has experienced excellent growth results in recent years, especially during the COVID-19 pandemic, and is expected to continue growing in 2023. The home improvement market includes the sale of building materials, appliances, and decor for home renovations, as well as the hiring of contractors and tradespeople to perform the work.

While the majority of homeowners renovate their homes to improve living conditions, some do so with an eye toward recouping some or all of the investment when they sell the property. To maximize the return on their home improvement investments, it is important for homeowners to understand which projects will add value to their houses and which should be avoided.

According to the National Association of Realtors (NAR), the most popular homeowner renovations are sparkling bathroom overhauls and adding an extra bedroom or bath. While these projects can certainly make a house more livable, they are unlikely to yield a significant return on investment when it comes time to sell. In fact, the NAR reports that only about 60% of homeowners recoup their remodeling costs upon selling their properties.

It’s important to compare estimates from different contractors before choosing a contractor for your home improvement project. In addition to price, consider the contractor’s experience, reputation, and ability to complete the work on time. It is also a good idea to get all promises in writing and to read the fine print on any contract. For example, a home improvement contract should clearly state that the contractor must notify the homeowner if it becomes necessary to cancel or suspend the work for any reason, and provide the estimated date for completion of the project.

Some home improvements are essential, such as fixing a broken window or replacing an old furnace. These projects should be completed as soon as possible to avoid damage to the property or health issues for the inhabitants of the house. Other important projects include refinishing hardwood floors, painting rooms, and redecorating the kitchen or bathrooms.

Other projects are more cosmetic in nature and may not add much to the resale value of a home. However, these upgrades can be very satisfying and may provide a good return on investment, such as updating the front door or refinishing the basement. Adding a deck or patio can also be a great way to make a home more attractive and livable, as well as boosting its value.