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March 12, 2014

Your Home is the Best Long-Term Investment

Lexington Home Renovation

Your home is the most important long-term investment. By choosing the right remodel project, and performing the necessary upkeep and maintenance, you can increase the value of that investment and put your family in a very lucrative position for a resale in the future.

Regular Maintenance Checks

The winter weather can reek havoc on your home. It is important to take the necessary precautions to ward off larger potential problems and keep your home in the best condition. Similarly to oil changes for your car, your house needs regular maintenance checks. It can be helpful to create a calendar in order to keep track of your upcoming “check ups”. Here’s a checklist created by Lowe’s, which should help jumpstart your own list!

Home Remodeling is on an Upturn

Another way to protect your investment for future profits can be through remodeling projects. While the winter months keep your thoughts on staying warm and protecting your home against the cold weather, Spring is the best time for renovations. As the winter snow melts away, it may be time to make those renovation and home improvement projects a reality. According to REALTOR Magazine’s Cost v. Value 2013-2014 report, the remodeling industry is on an upturn due to lower construction costs and stabilizing housing prices. As you plan for a remodel, the most important information to consider is your return on the investment. The following information can help you get the best bang for your buck.

According to the HGTV article on renovation “Which Home Improvements Pay Off?”, Kitchens and bathrooms are areas where a homeowner can yield the best results for renovations and return on investment. Even though these are often the most expensive choices in terms of costs for materials and construction, most families looking to buy a new home are looking for “move-in ready” spaces. Also, most families spend a large amount of time in their kitchens and bathrooms, so a remodel in either of these areas will increase the enjoyment of your home. Small changes can bring your dream home “dreams” to fruition.

The report ranked a “minor kitchen remodel” as number four of the top ten mid-range remodel projects with the most return. Estimated at $18,856 cost, this type of project would include repainting, new appliances, flooring, cabinets and door handles. The Cost v Value 2014 survey, which includes over 3,900 appraisers, sales agents, and brokers, projected 82.7% return on investment. If your kitchen needs work, this price is worth it because of the appeal to buyers and the value it adds in resale.

Remodeling a bathroom or adding a second to your existing home can also have high returns on investments if planned appropriately. The Cost v. Value report ranked an upscale bathroom remodel at number eight with a 63.6% return on investment. Here are the current trends for remodeling and also see below for a list of the top 10 mid-range and upscale projects according to the 2013-14 report in REALTOR Magazine:

Top 10 Midrange Projects

1. Entry Door Replacement (steel)
Job Cost: $1,162
Resale Value: $1,122
Cost Recouped: 96.6%

2. Deck Addition (wood)
Job Cost: $9,539
Resale Value: $8,334
Cost Recouped: 87.4%

3. Attic Bedroom
Job Cost: $49,438
Resale Value: $41,656
Cost Recouped: 84.3%

4. Garage Door Replacement
Job Cost: $1,534
Resale Value: $1,283
Cost Recouped: 83.7%

5. Minor Kitchen Remodel
Job Cost: $18,856
Resale Value: $15,585
Cost Recouped: 82.7%

6. Window Replacement (wood)
Job Cost: $10,926
Resale Value: $8,662
Cost Recouped: 79.3%

7. Window Replacement (vinyl)
Job Cost: $9,978
Resale Value: $7,857
Cost Recouped: 78.7%

8. Siding Replacement (vinyl)
Job Cost: $11,475
Resale Value: $8,975
Cost Recouped: 78.2%

9. Basement Remodel
Job Cost: $62,834
Resale Value: $48,777
Cost Recouped: 77.6%

10. Deck Addition (composite)
Job Cost: $15,437
Resale Value: $11,476
Cost Recouped: 74.3%

Top 10 Upscale Projects

1. Siding Replacement (fiber-cement)
Job Cost: $13,378
Resale Value: $11,645
Cost Recouped: 87.0%

2. Garage Door Replacement
Job Cost: $2,791
Resale Value: $2,315
Cost Recouped: 82.9%

3. Siding Replacement (foam-backed vinyl)
Job Cost: $14,236
Resale Value: $11,124
Cost Recouped: 78.1%

4. Window Replacement (vinyl)
Job Cost: $13,385
Resale Value: $10,252
Cost Recouped: 76.6%

5. Window Replacement (wood)
Job Cost: $16,798
Resale Value: $12,438
Cost Recouped: 74.0%

6. Grand Entrance (fiberglass)
Job Cost: $7,305
Resale Value: $5,163
Cost Recouped: 70.7%

7. Deck Addition (composite)
Job Cost: $35,158
Resale Value: $22,881
Cost Recouped: 65.1%

8. (tie) Bathroom Remodel
Job Cost: $51,374
Resale Value: $32,660
Cost Recouped: 63.6%

(tie) Major Kitchen Remodel
Job Cost: $109,935
Resale Value: $69,973
Cost Recouped: 63.6%

9. Roofing Replacement
Job Cost: $34,495
Resale Value: $21,731
Cost Recouped: 63.0%

10. Bathroom Addition
Job Cost: $72,538
Resale Value: $43,936
Cost Recouped: 60.6%

*Top Ten List adapted from REALTOR Magazine

Protect Your Best Long-Term Investment

Each step you take to improve your home is a great way to protect your long-term investment. Remodeling can yield great returns for a resale and the current enjoyment of your home. A new kitchen or bathroom is an easy way to make your home feel more luxurious and impress buyers in the future! Not to mention, the basic upkeep is a simple way to ensure that your money will be spent on the important things, rather than emergency problems in the future. Investing in your home can be enjoyed for years to come.

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