What's your number one goal when selling your home? For most homeowners it's selling it for what it's worth "“ especially if you've invested a lot of time and effort into updating it. Here are 7 home improvement projects that you can do that will give you the highest return on investment.
What is ROI?
Return on investment is a term that investors use to calculate how profitable a business venture was. In terms of house value, a return on investment is calculated by taking how much money you spend on a project, and then seeing how much that increased the home value when it sells. For example:
You complete a project for $300. When you sell your home, it sells for $1,000 more than it was originally worth. You would have earned $700, which is your ROI. You earned 230% of the original $300 you paid to do the home improvement project.
The following home improvements have a high ROI according to three studies completed by Home Gain, Remodeling.net and HouseLogic.
Home warranty protection plans
Sell Value: $2,300
Many sellers choose to protect their home's systems and appliances with a home warranty protection plan. This can increase your home's value by $2,300 and provides around a 600% ROI. Many homeowners decide to purchase a home warranty protection plan when selling their home because of the free listing coverage, as well as peace of mind it gives buyers. Many buyers will jump at the prospect of a home warranty protection plan because it makes sure that if old systems or appliances break down they will be repaired or replaced for a small service call fee.
Have you ever heard that the first impression is the most important? It's true, especially when you're selling your home! When a buyer first pulls up to your house, its curb appeal will determine if they want to buy it, and much they're willing to pay.
First up on home improvements you can complete to increase your home's value is changing up your entry door. The highest ROI for this home improvement tactic is to replace it with a steel door.
Sell Value: $1,252
Garage Door Replacement
Sell Value: $1,410
Garage doors are often overlooked but provide major curb appeal when done right. A nice, new clean garage door can increase your home's selling price. According to reomodeling.net, a garage door replacement costs around $1,595, and you can increase your home's selling price by $1,410. If you decide to put a home warranty protection plan on your home while selling it, the protection plan will cover the garage opener (the motor, eye sensors, switches, push arm, etc.) so if you just replace the door, the buyer will be protected if the motor fails from normal wear and tear.
Another way to increase your curb appeal and increase your return on investment is to replace the siding on your home. Depending on how much money you want to spend, you have a few options:
Stone is becoming an increasingly popular look for homes. Homeowners can replicate this by putting up faux stone veneer panels on the outside of their home. This not only transforms the home's look and feel, but it can also transform the selling price. Most faux stone paneling cost around $7,000,
Sell Value: $6,500
Sell Value: $13,975
Rounding out the curb appeal for your home is your roof. If you have a patched roof or missing shingles, a buyer will most likely be worried about the stat of the home. A great way to fix this is to hire a person to complete patchwork on your roof where there are soft spots, or replace your roof entirely.
If you do have the roof replaced have a home warranty protection plan with limited roof leak repair, the buyer will be covered if the roof begins to leak after rain or normal wear and tear.
Inside of Your Home
Remodeling your kitchen doesn't have to take thousands of dollars "“ and in this case, it's better if it doesn't. Updating the paint or hardware on the cabinetry to a more modern look and feel can increase a home's value when on the market. You may think you should buy all new matching appliances. If you purchased a home warranty protection plan for your house, appliances such as the oven and dishwasher will be covered. Thus, it might be a good idea to replace the paneling on the outside of the appliances so they match. A home warranty protection plan will cover the buyer if the oven or dishwasher fail from normal wear and tear.
Cost: $1,000 - $1,500
Sell Value: $2,000-$3,000
However, the more money you put into a kitchen remodel, only expect to get about 67 to 79% back:
Sell Value: $15,255
Sell Value: $1000-$1500
Small plumbing improvements can have big gains, according to HomeGain.com. Doing things like repairing toilets, unclogging drains, fixing leaking faucets and giving the hardware a makeover with paint can provide a 230% to 400% ROI. When a buyer walks through your home, having plumbing fixtures that are in working order can make sure the home will sell for more money.
A home warranty protection plan can also protect you and the buyer from expensive plumbing repairs on your toilets, pipes and water heaters.
Sell Value: $1000-$1500
Obviously we aren't talking about rewiring your entire home here, but if you have an electrical project that will cost around $300, it can increase your home's value and selling price. Things like replacing light bulbs, making sure the outdoor lighting works, cleaning the switch plates and light fixtures as well as adding dimming switches can provide a 230% to 400% ROI.
If you purchased a home warranty protection plan, your buyer will also be covered if some part of the circuit breaker, wiring or panels fails from normal wear and tear.
Are you interested in purchasing a home warranty protection plan for your current or future listing? You can learn about our free listing coverage here. Or, if you want to explore our plans and pricing to determine which type of home warranty protection plan is right for you in your current home. Finally, you can click here if you're ready to buy a home warranty protection plan.