The Best and Worst Home Improvement Projects for Increasing Home Value in 2023

Introduction

Investing in home improvement projects can significantly increase the value of your property. However, not all remodeling projects provide the same return on investment (ROI). In this article, we will explore the top five performing home improvement jobs that offer the highest ROI, as well as the five worst-performing projects. By understanding the work involved, cost, sale value, and ROI of each project, you can make informed decisions about which renovations are worth considering.

As we like to say, numbers don’t lie, so we pulled this article’s data from Zonda’s interesting 2023’s Cost vs. Value report, specifically the 2023 National Averages, where they looked at the cost, sale value, and return on many home improvement projects. We encourage you to dive deeper into your precise Region or City for more specific information.

And just before diving into the article, if you are looking at making your next real estate investment and are on the lookout for cost-effective, reliable loans, talk to our team at REI News. Our specialists are experts in pairing investors with affordable funding opportunities from reputable lenders.

Now, let’s look at the home improvement projects that bring you the best and worst returns on your investment.

Top 5 Performing Home Improvement Projects

Below we take a look at the home improvement projects that provided the sellers with the best return on investment.

HVAC Electrification Conversion

The HVAC electrification conversion takes the top spot in terms of ROI, with homeowners recouping 103.50% of their investment. This project involves converting your HVAC system from traditional fossil fuel-based sources to electricity. With an average job cost of $17,747, the value at sale is estimated to be $18,366. The conversion improves energy efficiency and can appeal to environmentally conscious buyers, not to mention being safer and requiring minimal maintenance.

Garage Door Replacement

Replacing your garage door offers an excellent return on investment, with homeowners recouping 102.70% of their investment. With an average cost of $4,302, the value at sale is estimated to be $4,418. Upgrading to a new garage door enhances curb appeal, security, and insulation, making it an attractive feature for potential buyers.

Manufactured Stone Veneer

Manufactured stone veneer is a cost-effective way to enhance the exterior of your home, and it provides a 102.30% recouped cost. The project has an average cost of $10,925 and can increase the value at sale to $11,177. Adding stone veneer to key areas, such as the front façade or accent walls, creates a high-end look without breaking the bank.

Entry Door Replacement | Steel

Replacing your entry door with a steel option provides a solid ROI, with homeowners recouping 100.90% of their $2,214 investment. The value at sale is estimated to be $2,235. A new steel entry door enhances security, energy efficiency, and curb appeal, leaving a positive impression on potential buyers.

Siding Replacement | Vinyl

While the cost recouped drops slightly to 94.70%, replacing your home’s siding with vinyl remains a strong investment. With an average job cost of $16,348, the value at sale is estimated to be $15,485. Vinyl siding offers low-maintenance exteriors, improved insulation, and enhanced curb appeal, attracting potential buyers.

With many of the most profitable projects improving the home’s curb appeal, we guess the saying “don’t judge a book by its cover” isn’t something home buyers subscribe to.

Worst 5 Performing Home Improvement Projects

Here let’s take a look at the home improvement project’s you’ll likely want to avoid if you want to make a return on investment at the time of sale.

Major Kitchen Remodel | Upscale

With a cost recouped of only 31.70%, a major upscale kitchen remodel is one of the worst investments in terms of ROI. The project has an average cost of $154,483, but the value at sale is estimated to be $48,913. This type of remodel involves a complete overhaul of the kitchen, including high-end appliances, custom cabinetry, and luxury finishes. While it may improve the aesthetics and functionality of the kitchen, the return on investment is relatively low.

Bathroom Addition | Midrange

Adding a midrange bathroom addition has a cost recouped of 30.20%. With an average job cost of $57,090, the value at sale is estimated to be $17,237. This project involves constructing an additional bathroom with standard fixtures and finishes. While an extra bathroom can be convenient for homeowners, the return on investment for this particular project is relatively low.

Primary Suite Addition | Midrange

Adding a midrange primary suite has a cost recouped of 30.00%. With an average job cost of $157,855, the value at sale is estimated to be $47,343. This project typically includes constructing a spacious bedroom with an attached bathroom and walk-in closet. While a primary suite is desirable, the return on investment is lower compared to other remodeling projects.

Bathroom Addition | Upscale

Upscale bathroom additions have a cost recouped of 26.60%. With an average cost of $104,733, the value at sale is estimated to be $27,830. This project involves constructing a high-end bathroom with luxurious fixtures, finishes, and premium materials. While it may create a lavish bathing space, the ROI for this upscale addition is relatively low.

Primary Suite Addition | Upscale

Upscale primary suite additions have a cost recouped of 22.70%, making them one of the least profitable projects. With an average job cost of $325,504, the value at sale is estimated to be $73,875. This type of addition includes a luxurious bedroom, spa-like bathroom, and custom features. While it can create a stunning retreat, the high cost and limited ROI make it a less favorable investment.

The above projects are usually quite costly, and as they do not provide a return on investment, we wouldn’t recommend them based on the current information regarding national averages.

Conclusion

When considering home improvement projects to increase your property’s value, it’s essential to prioritize those that offer the highest return on investment. Using the above information and further data presented in Zonda’s report, you’ll be better equipped to make home improvement decisions that will increase your home’s value.

And should you be searching for real estate investment funding to help increase your home’s resale value, or you’re looking to invest in your next property, speak to the experts here at REI News. We are always ready to assist investors by transforming their dreams into reality by helping them secure affordable financing from reliable lenders. Talk to us today!