You made a big investment when you purchased your home and, like any other investment, you want its value to increase.
Unlike other investments that are wholly affected by fluctuations in the stock market, you can directly impact the value of your home by making home improvements. Sure, the real estate market will have an impact, but anything you do to improve your property will increase its value.
If you’ve ever watched HGTV, you know that updating the kitchen and bathrooms has historically been key to increasing the value of a home. But these rooms can be expensive to renovate and only return about 50-60% of the project cost at resale.
Exterior home improvements tend to be more affordable and offer a better return on investment, with an added bonus of visible curb appeal. The 2018 Cost vs. Value report from Remodeling Magazine breaks down the return on investment (ROI) for home improvement projects by region.
In this area, a new garage door costs an average of $3,500 and offers a 96% return. Adding manufactured stone veneer to the front façade of your home will run you about $8,300 and return 97% of the project cost at resale.
Other common exterior improvements include:
• Entry door replacement (steel) – average cost $1,800 | 91% ROI
• Deck addition (wood) – average cost $11,000 | 83% ROI
• New roof – average cost $21,000 | 68% ROI
You can also make landscape improvements by planting bushes and flowers, incorporating hardscape materials like concrete or paver walkways, and adding exterior uplights and pathway lighting. Our friends at HGTV say that an attractive, well-maintained yard can add as much as 10% to your home's overall value.
When you determine which projects you’re going to take on, research the materials and labor costs involved and establish a budget. Be sure to leave a cushion for any unforeseen expenses!
Pro tip: Check the property values of the other homes in your immediate area. If you over-improve for the neighborhood, you may not see as large a return on investment.
Once you’ve established a budget for your home improvement projects, consider taking out a home equity line of credit (HELOC) to pay for them. You’ll be able to borrow the amount you need at a low interest rate and pay cash for materials and labor, rather than incurring huge charges on a store credit card or submitting to a contractor’s financing terms.
Contact a VacationLand Federal Credit Union Lending Specialist at 800-691-9299 to discuss your options for a home improvement loan or home equity line of credit today.
VacationLand Federal Credit Union is an Equal Housing Lender.