In an economy with generally stagnant wages, enterprising folks will want to add value to their assets. If you own a home, one common way to add value is through major home improvements. If you’re thinking about renovations or repairs, here is a quick guide to the upgrades that add the most value to your home and how to get them done.
Can’t afford upwards of $10,000 for a medium-size makeover? Refinancing may be the best option for you to increase your home’s value while saving money on high interest costs. Read on for more details.
The most valuable room
Kitchen additions can be expensive, but they can also increase the value of a home considerably in a strong market. Having an open-concept modern-looking space with new countertops, over-the-range microwave, brand-name appliances, and refinished cabinets can cost an average of $20,000. However, it can add $30,000 to $40,000 in value to your home. Other reports say the more modest $15,000 renovation is the optimal return rate. Although it may seem sensible to go to a big-box store like Lowes or Home Depot for the renovation, opting for a family-owned or smaller local business, which offers rare finishings and out-of-the-ordinary garnishes not found in large stores, can be just as beneficial.
Tacking on some extra square footage is another way to bolster your resale numbers. Having extension ideas for your home or doing a major room build-out is an option if you have enough space in your yard, and you get permission from the city or township. If you have a homeowners association or co-op board where you live, expanding the size of your house or apartment may not be possible. The last thing you want to do is build a beautiful $15,000 extension and have to break it down because your home is deed restricted.
Once you have clearance, it’s time to find a reputable contractor. If a return on your investment is the main motivating factor, an honest and competent contractor will make all the difference with overall expenditures, even if the initial estimate is a bit higher than you’d like. When searching for a contractor, collect recommendations based on personal experience and do your own background check online to ensure that they have a license and years on the job.
Spending money to repair or replace a shoddy roof is a necessary evil, but it can also pay dividends in a sale. A Remodeling magazine study found new roofs increased value an average of $12,000. If you live in a hurricane zone or tornado zone, hurricane-proof roofing may be more valuable than an upgrade to the inside of your home. Just like with a major contractor, do your research and find a reputable, licensed company to overhaul what goes over your head. Make sure they use quality materials like Everlast II™, for example, because improperly done work can lead to thousands of dollars in damages. This includes dry rotted wood in the roof as well as mildew and even black mold, which is harmful to inhale.
Refinancing the dream
Getting a second mortgage can be a scary proposition, but with a quality mortgage broker you can get a low interest rate and enough cash to increase the value of your home considerably. Since finding the right money lender is key, it is good to know your options. Research the range of loan institutions: Consider mortgage services from one of the largest real estate companies in the northeast or search out smaller credit unions for, say, mortgage loans in Louisiana. If you’re worried about closing costs, shop around because certain lenders are known to wave these fees. A fixed rate home equity loan can alleviate your worries about rising interest rates. And if you’re concerned about your credit history, some lenders even have no minimum FICO score to obtain a loan.
Do detective work on money lenders and ask around about contractors. Choosing either one poorly may cost you more money in the end. But if you do your due diligence, you can be confident in your decision to refinance home renovations. Remember, these upgrades are not only appealing to your eyes, they can be satisfying for your wallet as well when they increase the overall value of your home.