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How Bathroom & Kitchen Renovation Projects Can Affect The Value Of Your Home

If you are thinking of renovating your home, chances are you are looking for ways to increase your enjoyment of the home by improving its appearance and function. Or you are about to sell or transform your property into an investment you hope that a renovation will boost its value.

These are the most common reasons why homeowners renovate their property. If these are your reasons, then the areas in your home that will deliver your expectations are the bathroom and kitchen.

Over the last decade, bathroom and kitchen renovations have consistently rated as the most sought-after renovations for buyers. That is because more than any area of the home, projects in these areas have the most impact on a home’s occupants.

Bathrooms matter because they are the most private room in the home, where we visit because of our sanitary needs. It is also the one room that marks the beginning or end of our day. Consequently, bathrooms are critical to our productivity and sense of wellbeing.

Conversely, kitchens are important social spaces that serve as the hub of the home. It is where meals are prepared and shared. And all of the value we attach to mealtimes are reflected in the way we value the kitchen.

That is why renovation efforts that focus on the kitchen and bathrooms are bound to affect the value of a home. Buyers may overlook inadequacies in the home if the kitchen and bathroom are perfect for them.

But how exactly do bathroom and kitchen renovations affect the value of a home? And do all kitchen and bathroom projects perform equally well? What are the projects which are most likely to deliver the best rewards for homeowners’ efforts?

How bathroom renovations improve home value

The cost of a bathroom renovation is around $20,000 for midscale renovation. Costs can go as high as $65,000 if the project is more upscale. Upscale projects often use high-end finishes and features.

However, it is also possible to do a bathroom renovation for far less than $20,000. For budget projects, homeowners have to use a targeted approach, which focuses on replacing or refurbishing critical aspects of the bathroom, rather than a large-scale overhaul.

On average, bathroom projects will return between 60.2% - 67.2% of the owner’s costs when the home is sold. It is rare for a bathroom project, or any home improvement project, to recoup 100% of what homeowners spend. But the bathroom projects with the highest ROI are:

  1. New plumbing fixtures: Simply changing the faucets and showers will improve the overall appearance of a bathroom. But this is best done in combination with sink replacement.

  2. Vanity upgrades: Wholesale replacement of the vanity will improve a home’s value instantly. If this is too much, repainting or re-facing the vanity is a cheaper option.

  3. A fresh coat of paint: painting the bathroom in trending bathroom colors will help you win prospective buyers.

  4. Improved lighting: Lighting is one of the most underrated bathroom upgrades, yet it is highly effective and easy to execute.

  5. Energy-efficient upgrades: Installing low flow and other energy-efficient features will increase the bathroom’s value.

How kitchen renovations improve home value

A nicely renovated kitchen is an effective way to create a showpiece in your home. Kitchens are one of the first areas visitors go to in the home, so they are a great selling point. This is why 80% of homebuyers place the kitchen among their top three most important spaces in the home.

The cost of kitchen remodels varies widely. Most homeowners budget between $5,000 and $50,000 on improving their home’s kitchen. But if you are installing custom features and high-end appliances, the costs could go up to as much as $65,000-$126,000.

When the renovation is completed, most kitchens will recoup 54%-81% of the cost of the renovation. Major upscale remodel will recoup around 54%, while minor remodels recoup over 80%. What this shows is that the usefulness of a renovation is more important than its cost.

The most valuable kitchen renovation projects, in terms of ROI, are:

  1. Repaint the kitchen: Prospective buyers are more likely to fall in love with a kitchen if the colors are carefully chosen and masterfully executed.

  2. Renovate the cabinets: Kitchens benefit immensely from complete cabinet replacement or refinishing (or re-facing) of the existing cabinets.

  3. Backsplash addition or replacement: Adding a new backsplash to help bring the color palette together can add a few thousand dollars to a home’s value.

  4. Overhaul appliances: Paint appliances that are still in good order. You will often achieve the same result as buying new ones.

Finally, location determines if your bathroom and kitchen renovation will be profitable. Know the features that buyers in your location value most and implement them. That is the only way you can improve your ROI.

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