How to Use Tax Refund to Increase Home Value in Virginia Beach
As we celebrate another new year and the beginning of a prosperous 2015 for each of us, we at Regal Renovations know that most of us are getting excited about tax season! Well, ok - maybe not. But many of you ARE expecting a refund and are probably considering the wisest investment opportunity. There are many opportunities that will yield a pretty solid ROI (Return On Investment), but few are as dynamic - or as fun to watch happen in real time - as renovations or restorations to your home! We’re going to discuss a few but you can use the widget to the right to see the full list.
But let’s start here for a moment. A lot of us have had the preconceived notion that the investment we make on home improvement projects is 1:1. In fact though, almost all projects carry different values of ROI, even for the same type of project, depending on how thoroughly you perform the remodel. Using the tools that are available can not only help you set a realistic budget for your project but can help you ensure that you truly are making an “investment” for your home and not just spending money. Of course this is all relative, depending on how long you’re planning to be in your home! If you plan to be there for 10 years, an ROI of 70% for a more expensive project could be more profitable in terms of real “value” to you than it will be in selling the home. But, if you’re wanting to increase the value of the sale of your home, typically less is more, especially for a kitchen renovation which may only yield 74% for a more extensive project. So while this is a great way to help you get started, your own intentions for the project play a much more significant role in making the best decision for you and your family!
At just under $19,000 a minor kitchen remodel can yield around 82% ROI while a more significant kitchen renovation at a national average of about $55,000 will only return about 74%. Well that’s only 8% right? Well the amount of money invested for a larger project might actually carry an “expense” versus an investment of almost $15,000 where the “expense" value of the smaller project is only about $3,400. So deciding why you want to update the kitchen can save you a significant amount of money if you’re only doing what you THINK is the right thing for your specific situation! Replacing dated appliances, countertops, cabinet hardware and adding a new splash of color with paint on the walls and cabinets and adding a backsplash will possibly do more for you in selling the home than going all out. Remember, your business is important to us and we’ll do what it takes to EARN it, but our mission is to educate through the sales process. So by sharing your overall intentions and the budget you have to work with from the beginning will help us to better serve you!
While the average national investment for a bathroom remodel is just over $16,000, the ROI is a little less than the minor kitchen renovation at about 72.5%. But, a modern bathroom is high on the list of many home buyers especially with HGTV ratings climbing higher and higher! If you’re working on a tight budget, you can still make a solid impact by keeping the tub, toilet and sink and focusing more on the vanity top (solid surface is always best!), better faucets/shower head and updating the shower tile. Fresh paint on the walls and even sometimes the vanity itself will really bring more visibility to the space and help shift it off the market to SOLD! Of course if you’re remodeling for your own taste and distinction, the value is, and the possibilities are limitless.
Carrying a much higher investment and a lower ROI, room additions are typically more for the current owners and the quality of life for their families than for the increased resale value. But it’s still important to consider when thinking of whether to love the space you’re in and make it exactly how you want it, or list it and move on to greener pastures. Many times the sentimental value of your home being YOURS outweighs the potential benefits of moving. With the return still nearly 72%, an addition is still a good option to increase the value of the home AND make it more functional, especially when an interior renovation is performed simultaneously.
Other projects also carry a great return because of the demand they meet for the latest desires of potential home buyers, like decks. For the return, wood is better but for the long term value, composite or synthetic is always best! Anything on the exterior of the home that increases energy efficiency is not only a tax write off and a monthly savings on your utility bills for the time that you’re in the home, it also carries a warm feeling for a potential buyer that they’re going to keep a little extra jangle in their pocket each month as well. The bottom line for each of us is, “Is this an investment or an expense?” If you can call your decision an investment, you’re headed the right direction. If you’re unsure what to do next or how to make sure you’re investing wisely, give us a call or request a quote here and we’ll be happy to walk you through the project, even if it’s for the future. There’s never anything wrong with planning and we’d love to earn your TRUST now even if it means earning your BUSINESS later! We look forward to talking more soon!
Referrals are the lifeblood of our business. Starting in 2015 we are instituting a referral bonus program! If you know someone who is in need of an honest and reliable Class A, fully insured contractor, we’d love to hear from you! Give us a call at 757-327-8082 or shoot us an email for further details!