Homeowners looking for ways to increase the value of their home need look no further than the ground beneath their feet.
According to the National Association of Realtors 2022, refinishing a home’s hardwood floors will bring the greatest return on investment among the most common renovation projects undertaken by homeowners since the start of the pandemic. Remodeling Impact Report.
Homeowners spent an average of $3,400 refinishing their floors, and the project added an estimated $5,000 resale value to the home, resulting in an impressive 147% return on investment.
Homeowners who decided to install new flooring also saw a very high return on investment, spending around $5,500 on new wood floors, but getting an estimated resale value of $6,500, a return on investment of 118%. Upgrading a home’s insulation was the only other project where homeowners recouped at least 100% of the installation cost in resale value.
Best Home Improvement Projects for Return on Investment
The following residential projects top the list for the highest cost recovery:
- Renovating hardwood floors: 147% return on investment
- New parquet: 118%
- Improve insulation: 100%
- Conversion of a basement into a living space: 86%
- Cupboard renovation: 83%
- Conversion of an attic into a dwelling: 75%
- Complete kitchen renovation: 75%
- Bathroom renovation: 71%
- Modernization of the kitchen: 67%
- Addition of a new bathroom: 63%
- Addition of a new master bedroom: 56%
Why are floors such a good investment?
“For homeowners looking to sell, it’s hard to deny the beauty of newly finished floors in home videos and listings,” Jessica Lautz, director of research for NAR, said in the report. “For owners planning to stay in their homes, it may feel more hygienic during the pandemic.”
Projects that have traditionally been considered the biggest money-makers when it comes to selling your home, such as a complete kitchen remodel and bathroom remodel, had an estimated resale value of 75% and 71% respectively, which is by no means a bad return on investment.
Home improvement during the pandemic
Home improvement projects have seen a big boost coinciding with the pandemic. An estimated $420 billion was spent on home improvement projects in 2020 alone, as lockdowns and social distancing curtailed dining out and vacations were put on hold. The money saved has been put to good use making our indoor lives more comfortable and useful, Lautz notes, with renovations that have added or improved spaces for home offices and areas for working out or attending virtual school. .
“Homeowners embraced small changes to make their space shine, like painting and refinishing hardwood floors, but extended into attics and basements to use every square inch possible,” Lautz said.
While most homeowners surveyed in the NAR report planned to make improvements to their homes regardless of the pandemic, 60% said they increased the scope of renovation because of it. Another 86% said their initial renovation led to other home improvement projects being undertaken.
Lautz suspects homeowners will embark on other home improvement projects this year. Recent buyers will want to tailor their living space to their needs, and other homeowners can strategically undertake profitable renovation projects that help them get the best price when they put the home up for sale in today’s hot market. today.
“For owners considering selling, reviewing ROI can be crucial to understanding what to address and perhaps what to leave for the new buyer to personalize,” said said Lautz.
The home renovations that bring the most happiness
In addition to looking at the economic gains of a remodel, the NAR study assigned a “joy score” designed to measure the happiness homeowners derive from each project, with a score of 10 bringing the most joy.
Not surprisingly, there were many more projects that brought a high degree of owner joy than projects that recouped more than 100% of their estimated costs.
The wood floor finish and installation scored a 10 on the joy scale. 100% of homeowners say they have a greater desire to be at home since refinishing their floors, while 90% of homeowners feel the same after installing new floors.
Joining new floors at the top of the list of joys was painting the interior of the house, adding a new home office, and renovating a closet.
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