While some projects can substantially increase your home's value, others might not yield the return on investment you're hoping for. Knowing which renovations will add value to your home and which ones might be better left on the drawing board is essential. After all, the goal is to invest in changes that enhance your quality of life and your home's equity. With the right remodeling tips, you can ensure your efforts are personally satisfying and financially rewarding.
Renovations that make a difference
The impact of kitchen remodeling
According to Remodeling Magazine's Cost vs. Value Report, homeowners who invest in kitchen remodeling can expect a return on investment (ROI) of 60-80%. The key to maximizing this ROI is choosing upgrades that appeal to a broad range of buyers. Upgrading countertops to durable, high-end materials like granite or quartz instantly elevates the kitchen's appeal. A kitchen island provides additional workspace and enhances the room's flow, making it more functional for everyday use and entertaining. Energy-efficient appliances reduce utility costs and are increasingly in demand among eco-conscious buyers.
The value of bathroom renovations
Updating your bathroom with contemporary fixtures, sleek new tiling, and luxurious features like double vanities or a walk-in shower can yield an ROI of 71%, as reported by the National Association of REALTORS®. These upgrades enhance functionality and create a spa-like experience that buyers find irresistible. For instance, a walk-in shower with modern glass doors can make even a tiny bathroom feel more open and inviting. A stylish and functional bathroom can make your home stand out in a competitive real estate market like Chicago's, where every square foot counts.
The benefits of energy-efficient windows
Chicago's infamous winters make energy efficiency a top priority for homeowners. Upgrading to energy-efficient windows is a renovation that pays off in more ways than one. These windows improve insulation, reducing drafts and keeping your home warm in the winter and cool in the summer. According to the U.S. Department of Energy, homeowners can recoup 70-80% of the cost of installing energy-efficient windows through increased home value. These windows enhance the home's aesthetic appeal by offering cleaner lines and often better views, making them attractive in any home.
The advantage of finished basements
A finished basement can be a game-changer when space is at a premium. Transforming an unfinished basement into a functional living area — a family room, home office, or even a guest suite — adds valuable square footage to your home. The additional space is particularly appealing in Chicago's urban environment, where larger homes are often in short supply. The National Association of REALTORS® notes that homeowners can see an ROI of 70-75% on a finished basement, especially if the renovation includes adding a bathroom or kitchenette. It makes the space more versatile for potential buyers looking for a home that accommodates guests.
Enhancing curb appeal
The exterior of your home can make a lasting first impression. Simple, cost-effective improvements like fresh landscaping, a new front door, or a fresh coat of paint can significantly boost your home's appeal to potential buyers. According to the National Association of REALTORS®, these curb appeal enhancements can offer an ROI of 75-100%, depending on the neighborhood and the specific upgrades. For instance, adding native plants to your landscaping enhances the beauty of your yard and appeals to eco-conscious buyers interested in sustainable living.
Renovation pitfalls
When high-end landscaping misses the mark
Curb appeal is undeniably important, but going overboard with elaborate landscaping can be costly. These high-maintenance features can deter potential buyers in Chicago, where the weather is unpredictable and the growing season is short. According to the National Association of REALTORS®, the return on investment for high-end landscaping projects can be as low as 50%, especially in urban areas with limited outdoor space. Excessive landscaping can be seen as more of a hassle than a luxury. It's important to remember that not every buyer is willing to take on the upkeep of an elaborate garden, and in a city like Chicago, where seasonal weather limits outdoor use, simpler is often better.
Cool but costly
A swimming pool might seem like a glamorous addition to any home, but it can be more of a liability than an asset in a city like Chicago. With a short summer season and harsh winters, pools are often underused, leading to a low return on investment. The National Association of REALTORS® reports that homeowners typically recoup only 56% of the cost of installing a pool, making it one of the least profitable home improvements.
Additionally, the ongoing maintenance costs can be a turnoff for many potential buyers, who may view a pool as more of a burden than a luxury. In a market where outdoor living space is often at a premium, the area taken up by a pool could be better used for a garden or patio that can be enjoyed year-round.
When customizations go too far
It's natural to want to personalize your home, but highly customized renovations can reduce its market appeal. Themed rooms, unique layouts, or overly specific designs might reflect your style, but they can also limit the home's appeal to a broader audience. A report by Remodeling Magazines suggests that overly personalized renovations often recoup less than 50% of their cost, as potential buyers may see these customizations as something they would need to undo. It's better to focus on neutral, versatile upgrades that enhance the home's functionality and appeal to a wide range of buyers, especially when getting ready to sell your home.
The home office dilemma
The rise of remote work during the pandemic increased demand for home offices. However, dedicating a large portion of your home to an office can backfire, especially in a city like Chicago where living space is at a premium. As many buyers prioritize flexible living spaces over a dedicated office, converting a bedroom into an office can make your home less appealing to families or buyers who need more living space. It's worth considering more versatile solutions for Chicago homeowners, like adding a small office nook or choosing furniture that can easily be converted for different uses.
The cost of expensive attic conversions
Converting an attic into a living space might seem like a smart way to add square footage, but in Chicago, this renovation can be more complicated than it's worth. Attic spaces in older Chicago homes are often small, oddly shaped, and require significant structural work to meet building codes. The cost of these conversions can be high, and the return on investment is often low. Instead, consider focusing on renovations that improve the main living areas of your home, where buyers are more likely to see the value.
Partnering with experience
When deciding which renovations will add the most value to your Chicago home, Summerville Partners offers the expertise you need. With nearly 30 years of experience, 1,746 transactions closed, and over $650 million in sales, they have a proven track record of helping homeowners make intelligent decisions. Their loyal clientele trusts them for personalized advice that aligns with the current market and individual goals.
