(photo credit: hedgehog94)
At first glance, a new report on adding resale value to an existing home seems counterintuitive. In its 37th annual Cost vs. Value (CVV) report, Zonda Media notes that “unsexy” exterior improvements such as installing a new garage door will offer better return-on-investment when the home is listed for sale than a spectacular chef’s kitchen or a bath with all the whistles, bells and plumbing fixtures of those baths, (a/k/a “spathrooms”) that are currently basking in Pinterest glory!
A garage door versus a new kitchen…who knew? The renovation experts, that’s who.
What This Means for You — Not all home improvements offer the same ROI on renovation, and this is important to remember when it comes time to put the home up for sale. Homeowners who are contemplating the sale of their residence should also remember that consumer sentiments on what constitutes “value” in an existing home will often change from year to year. This makes having unbiased research on this subject critical for investing in renovations.
Want some great ideas for home improvement products for your renovation? Click here and prepare to be wowed!
Three Words to Remember: Supply and Demand
Photo credit: Lauren
The market theory of “supply and demand” was popularized by Adam Smith a long time ago, in 1776, and it has never been truer than it is now. Smith pointed out that consumer demand for goods decreases as their prices increase. As prices rise, producers manufacture more to gain more profits. This somewhat daunting reality is currently at work in the housing market.
As noted by CNBC, “With high home prices and a tight supply of homes for sale, sellers need to be especially strategic in their efforts to attract buyers willing to pay top dollar in today’s market, according to Todd Tomalak, Zonda’s principal of building products research.
“Further, financing renovations or improvements with a home equity loan or home equity line of credit has gotten more expensive along with the Federal Reserve’s string of 11 rate hikes since 2022, including four last year (2023).
“‘A new garage door or new entry door can make a pronounced difference,’ Tomalak said. ‘It could be the thing that makes one house stand out against all the others, making the home worth a higher price.’”
Besides garage doors, what are the other reno strategies that offer the potential for higher ROI? Take a quick look.
Curb Appeal Drives Home Sales
As highlighted by the CNBC article, “Forget a designer chef’s kitchen; the projects offering the greatest returns in resale value are mostly related to curb appeal rather than more glamorous kitchen and bath remodels, according to Zonda’s report.”
In fact, nine out of the top ten projects with the highest return on investment were exterior improvement projects, the report found.
“When it comes to adding resale value to a home, exterior replacement projects continue to make the most sense,” Clay DeKorne, chief editor of Zonda’s JLC Group, said in a statement.
The CVV reports noted a unique situation with this year’s analysis. “There has been a strong shift in the existing home market that favors move-up buyers,” says Todd Tomalak, a principal of Zonda Advisory. This cohort is more discerning than first-time buyers. At the same time, there are fewer existing homes for sale, meaning fewer homes that meet this discerning buyer’s quality standard.
According to the research, “not all projects have risen in value, however. The HVAC conversion (replace a fossil-fuel-burning furnace or boiler with an electric heat pump) ranked at No. 1 last year with 104% ROI; this year, the project has fallen to No. 12 with 66% ROI.
“The change is likely driven by lower natural gas prices and higher electricity prices in 2023 compared to the year before. When the HVAC conversion debuted as a CVV project in December 2022, it was new to many real estate professionals, and they didn’t have a lot of experience with what this big-ticket conversion might do to existing home prices.”
Taking Advantage of These Trends
This “reno-research” is excellent food for thought for homeowners who are planning on selling their residence in the immediate future. However, some may be hesitant to invest the amount necessary for the (hoped-for) ROI. For example, the research suggests that replacing a garage door will require slightly more than $4,500 and will (perhaps) return $8,700 when the home is sold. That may be too much of a bet or investment for some homeowners.
The Garage Strategy
The Zonda experts note another way to ride on the “garage wave” is a “thorough cleaning” and some old-fashioned decluttering and organization of this multipurpose room. Here are 12 ways to accomplish this: For the “Dirty Dozen Hacks for Organizing Your Garage,” just click here.
Shut the Front Door!
Replacing the home’s front door with one made of steel is the second-best idea for scoring a big ROI win, and, on average, it will require an investment of $2,400. The same or better quality and aesthetics can be had with Exclusive Iron Doors available from Acme Brick, starting at the same or lower price. These doors are custom made and designed to work with any architectural style. The look is classically stunning, and for more information on these beautiful doors, click here.
Stone Veneer Instead of Siding
The third-best renovation strategy for enhancing ROI involves replacing siding with stone veneer. Acme offers two of the best stone veneer products that will go a long way toward improving the curb appeal of any home.
Stone veneer in general has grown thanks to benefits such as its relative ease of installation, durability, limited maintenance requirements, and timeless appearance. Coronado Stone Products, in particular, have almost limitless versatility.
Compared with standard sizes in brick and natural stone products, Coronado offers over 100 unique sizes and textures of stone products. In addition to the unique textures offered, these products come in over 100 different standard colors and offer the opportunity to produce any stone in thousands of custom colors.
Another excellent choice for slate veneer as a replacement for siding is CUPACLAD® Rainscreen Cladding. This is a sustainable and competitive solution that uses high-durability black slate and new fastening systems that take full advantage of the efficiency of ventilated façades. Many experts consider this natural slate to be the best cladding product in the world.
All CUPACLAD slate is extracted and selected from the world’s largest reserves of natural slate, in northwest Spain. The company’s 20 quarries in this region produce slate that’s considered by international experts to be of the highest quality and beauty.
Quick Fix in the Kitchen
The fifth-best renovation strategy involves minor kitchen upgrades. This can be new appliances, counters, and backsplashes. One of the hottest products in the world of interior design is Zellige tile, which can dramatically enhance the kitchen in the form of a stunning backsplash.
Zellige tile is pure Moroccan magic, especially in the kitchen. Zellige (pronounced zell-idge) is a type of tiling that originated in Morocco, where handcrafted tiles were made from a special blend of local clay and then glazed and fired, resulting in a surface with various irregularities that give each tile a unique look. That variety of tone, flatness, depth, and shade is perfect for lending character to whatever space is being tiled—hence Zellige’s popularity.
Other Ideas Worth Considering for Outstanding ROI
Of course, there are some home improvement products that are not on the CVV list but still offer a curb appeal advantage. Click on any of these products and consider the possibilities when it comes time to sell a home.
- Romabio limewash for the gorgeous painted brick look of European homes.
- Seves Glass Block windows and walls for natural light with privacy.
- Bromic Patio Heaters to keep the outdoor entertainment space warm and cozy in any weather.
- Fire Features for amazing outdoor entertainment spaces.
- GrassTex Turf is synthetic grass that always looks great in any season.
- Box Gobbler Delivery Systems, a work-from-home necessity.
Join the Renovation Nation
Choosing renovation projects that improve curb appeal of an existing home can make a huge difference in its desirability for future buyers. If you are considering selling your home, NOW is the time to plan the work and work the plan.
Acme Brick is more than just brick. We have home improvement products that can change the look and functionality of any home, at any age.
Here are some great ideas.