Right now, the inventory of homes is less than a two-month supply (with six months’ supply being balanced). So few homes on the market means it’s a great time to be a seller. The data shows that homes sold in the first quarter of the year tend to receive a higher sale price.
With spring just around the corner, you may be thinking about a remodeling project. Increasingly, homeowners are looking for cost-effective ways to improve the value of their home. The 2015 “Remodeling Cost vs. Value” report has some good information. Produced by Remodeling magazine, in cooperation with the National Association of Realtors, the annual report evaluates the most-popular remodeling projects and updates recommendations for 2015.
Replacements
The byword for 2015 is replacement versus renovation. In general, replacement projects always cost less than renovations or additions, and replacements provide a bigger payback.
Projects that enhance the curb appeal remain the most cost-effective way to improve the value of your home. As the saying goes, “First impressions are lasting impressions.” Take a close look at your front door, porch, siding and windows.
Topping the list of projects at No. 1 is replacement of the front door. It’s the least-expensive project evaluated by the authors of the report, but it ranks highest on the payback scale. In many cases, replacing the front door or garage door will return more than 100 percent of the cost.
Ranking No. 2 on the list of projects is replacing the siding. Among the projects with the highest return is adding manufactured-stone veneer to your home.
The project that ranked No. 3 is replacing your garage door. Along with replacing your existing windows with wood-frame windows, these are projects that return most of their investment cost.
Kitchen remodeling still offers the highest return when compared to other remodeling projects. However, the new report suggests that you may be wise to focus on a minor remodeling project, instead of a major renovation. For example, you’ll be money-ahead if you replace the appliances, countertops, sink, faucet and flooring. Paint or varnish the cabinets, rather than replace them.
The good news for Seattle-area homeowners: You can expect a greater return on your investment in the west. In Alaska, California, Hawaii, Oregon and Washington, there are six projects that will return more than 100 percent of the money spent. Below, are the top projects for Washington homeowners:
•Entry-door replacement: 113-percent Return-on-Investment (ROI)
•Deck or patio addition: 109-percent ROI
•Minor kitchen remodel: 104-percent ROI
•Window replacement (wood): 102-percent ROI
•Attic bedroom addition: 102-percent ROI
•Basement remodel: 102-percent ROI
•Window replacement (vinyl): 100-percent ROI
Think like a buyer
To begin, look at your home the way a buyer would, either in person or online. Perhaps you can sand and paint the front door a vibrant color. But if your front door is old, sticks when opening and the doorknob is loose, consider replacing the door and hardware with new ones.
If your home is modest, an alternative to a costly, new family-room addition might be a new patio and outdoor conversation pit.
In the Northwest, which is famous for long, gloomy winters, consider adding a skylight in the bathroom or kitchen.
Simply replacing your old kitchen appliances with a matching set of new, stainless steel appliances is one of the easiest and most effective things you can do.
It always helps to have another set of eyes on the project. Contact your friendly Realtor, who sees hundreds of homes each year. Seek his or her advice on which projects will have the greatest impact on the value of your home.
RAY AKERS is a licensed Realtor for Lake & Co. Real Estate in Seattle. Send your questions to ray@akerscargill.com or call (206) 722-4444.