Whether you’re considering minor updates to perk up a room, or a full-scale renovation of your entire home, it’s important to be aware of how renovations might affect your property value, especially if you’re thinking of selling in the near future.
Since most renovations resolve an issue or improve quality of life, many people automatically assume that they also increase a property’s sale price. That’s often true— but it’s not always the case. According to the Appraisal Institute of Canada, “If the value of your house exceeds the average market value in your neighbourhood, your renovations will not yield much return. But if your house value is below the average, you can recover a larger part of the renovation costs.” That being said, there are certain changes to a home that are more likely to yield a financial return on investment. Top renovations that have the most potential for a financial return on investment include:
Kitchens
Kitchen renovations often give you the best return on investment compared to any other room in the house. Remember to carefully calculate your budget and to take into consideration the average house price in your area to make sure that you aren’t pricing yourself out of the market should you choose to sell. A kitchen upgrade often yields a 75% to 100% return on investment.
Bathrooms
The majority of people prefer bathrooms with a soothing colour palette and modern design with chic materials and finishes. Bathroom renovations typically yield a 75% to 100% return on investment.
Income Suites
Income suite renovations, such as a basement apartment, an attic, a loft conversion, or a coach house style suite in a garage, when done correctly, can often double your investment. An income suite adds a significant amount of value to your home and it can help you make money while you build.
Floors
Hardwood floors are the number one requested type of flooring by prospective homeowners. Hardwood looks fantastic, it is classic and super durable. Make sure you do a lot of research on the different types available on the market so that you get the most bang for your buck.
Doors
Replacing an older front door with a new, high-quality one can often pay back over 70% on your investment and it greatly improves curb appeal. The same thing applies for a new garage door replacement.
Hardware & Fixtures
Homes that are fresh and updated always sell faster and often at a higher price. A very simple way to modernize the look of a home is to update things like faucets, sinks, toilets, cabinet hardware, doorknobs, light fixtures, etc. Hardware updates can improve the entire feel of a room and a small investment can equal a big return.