Top Home Renovation Projects with the Best Long-Term Return on Investment.
Written by Wena Roeloffze, Real Estate Consultant and Lifestyle Expert. Owner of Realty Club 74, brokered by Coldwell Banker Realty.
Renovating a home is a significant investment, and homeowners naturally want to ensure that the money they put into their property yields the best possible return. While some upgrades might enhance your day-to-day living, not all renovations offer the same financial payoff when it comes time to sell. Here’s a look at which renovation projects in a residential home typically provide the best return on investment (ROI) in the long run.
1. Kitchen Remodel
The kitchen is often considered the heart of the home, making it a key area for renovations. A minor kitchen remodel—updating cabinets, replacing countertops, upgrading appliances, and adding a fresh coat of paint—can offer a strong return. According to Remodeling Magazine’s Cost vs. Value Report, minor kitchen renovations often recoup 70-80% of their cost at resale. Homebuyers tend to prioritize updated kitchens, so this is one area where investment is likely to pay off.
2. Bathroom Remodel
Bathrooms are another high-impact area. Similar to kitchens, a modest bathroom renovation—replacing old fixtures, retiling, updating lighting, and perhaps adding energy-efficient features—can offer a substantial ROI, often around 60-70%. Simple updates that modernize the space without breaking the bank can make a significant difference when potential buyers are evaluating a home.
3. Curb Appeal Enhancements
First impressions matter, and curb appeal can have a surprisingly strong influence on home value. Projects like replacing an old front door, updating siding, adding a fresh coat of exterior paint, or landscaping can offer some of the highest returns. For example, replacing a garage door or adding a new front door often recoups more than 90% of the cost. Buyers are drawn to homes that look well-maintained and inviting from the outside. Even just an exterior power wash, getting rid of weeds or junk can make a huge difference.
4. Energy-Efficient Upgrades
In today’s environmentally conscious market, energy-efficient upgrades are increasingly attractive to buyers. Installing energy-efficient windows, upgrading to a smart thermostat, or adding insulation can lower utility costs, making the home more appealing. These types of improvements not only increase the home’s value but also provide ongoing savings on energy bills, which is a selling point for potential buyers.
5. Adding a Deck or Outdoor Living Space
Outdoor living spaces have become increasingly popular. Adding a deck or patio can expand the usable space of your home and provide a place for entertaining or relaxation. A well-constructed deck can offer an ROI of 70-75%, making it a worthwhile investment.
6. Basement or Attic Conversion
Converting underutilized spaces like basements or attics into functional living areas can significantly boost a home’s value. Whether you turn a basement into a family room or an attic into a bedroom or office, this added square footage appeals to buyers and often results in a solid ROI. Depending on the extent of the renovation, these projects can recoup 65-75% of their costs.
7. Roof Replacement
A new roof might not be the most glamorous upgrade, but it’s an essential one. A well-maintained roof is a key selling point, as buyers want to avoid the expense and hassle of replacing it themselves. While the ROI for a roof replacement typically ranges from 60-70%, it’s a necessary investment that can make or break a sale.
8. Garage Door Replacement
One of the simplest yet most cost-effective renovations is replacing an outdated garage door. This upgrade not only enhances curb appeal but also provides a high ROI—often more than 90%. A new garage door can significantly improve the exterior look of a home and is a relatively low-cost project compared to other renovations.
9. Smart Home Technology
Investing in smart home technology, like security systems, lighting, and climate control, can be appealing to tech-savvy buyers. While the ROI for these upgrades varies, the added convenience and modern feel can make your home stand out in a competitive market.
While no renovation guarantees a specific ROI, focusing on projects that improve functionality, energy efficiency, and curb appeal generally offers the best long-term value. Before starting any renovation, it’s essential to consider the local market and the preferences of potential buyers. By investing in the right areas, you can not only enjoy your home more while you live in it but also increase its value when it’s time to sell.
If you forgot or didn’t know, here is a short list of collaborators I work with to help with ANY renovation project you are considering: Painters, Flooring experts, Architects, Interior Designers, Renovation Specialists, Roofers, Organizers and Stagers, Landscape Specialists, Concrete Experts, and many more. Let’s talk about how best to preserve your biggest asset! You can also fill out the form below.