Are you daydreaming about building an addition or creating the kitchen of your dreams? Before hire a contractor, you might want to consider how much value these expensive projects will add to your home. A low return on investment may be worth it if you intend to enjoy your home for a decade or more. But if you plan to put your house up for sale in the next couple of years, you should reconsider renovations that won’t increase the value of your home—at least, not as much as you think. Here are the biggest home improvement projects that won’t pay off when you sell your home.
Swimming Pools
Installing an in-ground swimming pool can set you back almost $30,000 when you include fencing and landscaping, but may only add a little over $5,000 in value to your home. And since many buyers are turned off by the prospect of having to maintain a pool (or worry about the safety factor with small children), this outdoor project just isn’t worth it in most neighborhoods.
The Alternative: If you want to enjoy backyard swimming in the summers, try an inexpensive above-ground pool that can be removed later.
Upscale Kitchens And Baths
If your kitchen is sorely in need up updating, a minor kitchen remodel is well worth the investment. That math changes once you add in luxury items like stone countertops, a new island, custom cabinets, fancier appliances, and high-end fixtures. And while upscale bathroom fixtures and a walk-in shower may be what you’re dreaming of, don’t expect those features to pay off when you sell your home. You’ll recoup 40-50 percent of the cost of these upscale projects at best.
The Alternative: Replace cabinet fronts in the kitchen and stick with low-cost countertops and appliances. Use a standard porcelain tub and inexpensive ceramic tile in the bath. In both rooms, a fresh coat of paint goes a long way in freshening up the space.
Garage Conversions
Homes with garages have a slightly higher resale value and are very much in demand in areas with tight parking or severe winter weather. While it may be tempting to insulate your garage and turn it into a bedroom, look to other spaces if you can.
The Alternative: You can recoup about 86 percent of the cost of finishing a basement—a much better choice that allows you to increase your living space and keep your garage.
Sacrificing Space For A Primary Suite
If all that time you’ve spent watching HGTV has you determined to create a spacious primary suite, think carefully before sacrificing a bedroom to do it. Even the smallest guest bedroom can have more value than a walk-in closet or private ensuite bathroom. However, there are exceptions to this rule. If you only have one bathroom, adding a second could attract more buyers in the long run. And if you have a five-bedroom house, combining two of them to make a gorgeous primary suite might make your home more desirable. Either way, the National Association of Realtors says this expensive home renovation project only recovers about 56 percent of the cost in value.
The Alternative: Look to less expensive projects to make your primary bedroom feel more luxurious, like new furniture, built-in storage, and fresh paint. Make small changes within the existing footprint to create more closet space or a private entry.
Installing Carpet
According to Zillow, homes with wall-to-wall carpet sell for slightly less than comparable homes. Installing carpeting over wood floors is an especially poor move, considering that you could recover almost 150 percent of the cost of having those floors refinished instead.
The Alternative: If you need to install new flooring, choose high-end vinyl or wood, both of which add value to your home.
Building An Addition
You may believe—and rightly so—that adding more bedrooms or bathrooms to your home will increase its value. But the unfortunate truth is that the cost of building an addition is far beyond what you’ll recoup in value, which is around 25-35 percent.
The Alternative: If you don’t plan to spend decades enjoying your home, talk with a real estate agent to see if moving makes more sense.
