If you're thinking of selling your home in 2014 or just want to ramp up your home value, it's important to educate yourself on which improvement projects will bring you the most return on your investment.
A great resource for your research is the 2013 Cost vs. Value Report, an annual collaboration between Remodeling magazine and REALTOR® Magazine, which breaks out the estimated cost of various projects and the estimated return on investment for those projects by region and by city, as well as by midrange and upscale projects. In general, this year's report shows that exterior replacement projects are the most cost-effective. If you plan to sell your home later this year, remember that the first impression your home makes on buyers is their first glimpse of the outside.
Here are 10 home improvement projects you should consider:
1. Replace Your Front Door
You may not even notice your front door anymore, especially if you regularly use another entrance, but a new door makes a great impression on buyers and yields an 86 percent return on your investment. If your front door doesn't need replacing or you'd rather spend less money, you can paint it and replace the hardware for a similar impact. Replacing your garage door recoups 75 percent of your investment.
2. Add a Deck or Patio
No matter where you live, buyers are looking for outdoor living space. You can recoup 77 percent of your investment on a new wood deck. If you already have outdoor space, consider enhancing it with a water feature, an outdoor fireplace or new landscaping.
3. Add Space
Depending on your budget and your goals for your home, an addition of extra bedrooms and bathrooms, a finished attic or an expanded casual living space can rapidly increase the value of your home. You can recoup 73 percent of your investment in an attic bedroom.
4. Remodel Your Kitchen
Buyers look most carefully at kitchens and bathrooms, so you should, too. You can recoup 75 percent of a minor kitchen remodel and 60-68 percent of a major kitchen remodel. If you're selling soon, be careful not to overspend on your kitchen. You may be able to do one or two things, such as replacing the appliances and painting the cabinets, or just replacing the counters with granite to garner a good offer.
5. Replace Your Windows
Buyers are interested in how your windows look and their energy efficiency. Whether you're replacing vinyl- or wood-frame windows, you can get a 72 percent return on your investment. When you're ready to market your home, be sure to highlight the new windows as a selling point.
6. Work on Your Lighting
Today's buyers like bright, light rooms, so look around your home and see if you need to upgrade your lighting fixtures or add more. You can hire a professional to add a few recessed lights to your kitchen and living areas and replace outdated overhead lighting fixtures to match contemporary tastes.
7. Replace Your Window Treatments
Make sure you're letting as much natural light as possible into your home and that your window treatments don't hide any oversized windows.
8. Update Your Bathroom
While a full, upscale bathroom remodeling project can cost as much as $50,000 and add only about $29,000 to your home's resale value, you can make cost-effective minor upgrades. Replace your fixtures and your mirror, repaint the space and jazz it up with some crown molding (depending on your home's style) and you'll have a space that looks new. While you're there, redo the caulk around your tub and shower and replace the grout on your tile flooring. If your tub is in bad shape, you may be able to have it resurfaced rather than replace it.
9. Replace Your Siding
If your home's exterior needs a major makeover, you can typically recoup 72 percent of your investment by replacing the siding.
10. Organize Your Closets
High on the list of priorities for today's buyers is adequate storage. If your home lacks big closets or has too few storage spaces, you can increase their efficiency with closet organizers.
No matter which project you choose, be careful not to over-improve your home for the neighborhood. A REALTOR® can offer advice about how to spend your money so that your home sells faster and for the best possible price.