24 Mar How Much Does a Kitchen Remodel Increase Home Value?
Eighty percent of homebuyers say the kitchen is the most important room in a house. This means that the state of your kitchen directly impacts both your ability to sell your house and the price you can get for it.
But how much, exactly, will a kitchen remodel increase home value? While there’s no single answer, it is possible to get a good idea of what you can expect. Here are the numbers.
The Importance of Kitchens
More than half of all recent homebuyers report that kitchen style played a key role in their home-buying decisions. Over two-thirds of buyers specifically stated that they were willing to pay more for homes whose kitchens featured key upgrades.
Kitchens consistently outrank other popular rooms and home features in buyers’ priority lists, including:
- Master bedrooms and bathrooms
- Central Air
- Closet space
But with kitchen remodels costing between $20,000 and $120,000 on average, understanding which renovations influence your return on investment (ROI) and how is crucial.
Factors That Influence Remodel ROI
The return on investment that you will see when remodeling your kitchen depends on several factors. These include:
- Where you live
- How much your remodel costs
- Which upgrades you choose for your kitchen
Where You Live
Some areas of the country routinely see higher ROIs on kitchen remodels than the national average. For example, the same remodel will typically get you a 12 percent higher ROI on the Pacific coast than on the Eastern Seaboard. A few states, by contrast, consistently report lower ROIs than the national average.
Local standards matter, as well. You can expect a higher ROI on your remodel if:
- You remodel a kitchen is small, dated, or under-equipped compared to your neighbors’
- The remodel gives your kitchen specific features considered highly desirable in your market
- The remodel repairs noticeable problems or brings your kitchen up to local codes
Over-renovating your kitchen so that it is dramatically more expensive than your market can support, on the other hand, can lower your ROI.
How Much Your Remodel Costs
Many remodel expenses are worth every penny. After a certain price point, however, it becomes difficult to recoup costs. This is where spending money wisely comes into play. Visit https://rkhbuilders.com/ to find the best contractor near you to remodel your property.
Which Upgrades You Choose for Your Kitchen
Extremely specific and personalized upgrades rarely provide a good ROI, like some brand new cabinets or a new countertop. To get the best ROI on your remodel, focus your efforts on key features of universal importance to buyers. Take a look at these Kitchen Remodeling Contractors that can make your kitchen look like you always dreamed of.
Average ROI for a Kitchen Remodel
National ROI averages for kitchen remodels vary depending on the scale and cost of the remodels in question. Minor kitchen remodels, defined as those costing around $20,000, have a national average ROI of 81 percent.
Major kitchen remodels done with midrange finishes have a national average ROI of 59 percent. Major kitchen remodels featuring heavily upscaled finishes have a national average ROI of around 54 percent.
Thanks to regional variations, homeowners can expect an ROI of almost 93 percent on minor remodels in:
Homeowners can expect a slightly lower-than-average ROI in:
- North Dakota
- South Dakota
In every case, however, it is best to consult a local real estate agent before remodeling as these professionals can give you customized local figures on what is most important to buyers in your market. This information can help you get the highest possible ROI, even in areas that tend to trend low.
Individual Features That Increase Home Value the Most
Just as kitchens impact home prices more than other rooms, certain kitchen features command more selling power than others. These key features are the same nationwide.
- Countertops and backsplashes
- Finishing touches
Here’s what you need to know about each of these essential features and their impact on ROI.
Kitchen cabinets play a vital role in making your kitchen work. Cabinets that are dated, poorly designed, or ill-maintained can make your kitchen a nightmare to use. With the right cabinets, on the other hand, a kitchen is:
- Aesthetically pleasing
- Easy and enjoyable to use
- Easy to keep clean and organized
- A comfortable and functional family space
Cabinets are also one of the first things potential buyers notice when they step into your kitchen. Their size, style, and color set the tone for the space. Traditional cabinetry, for example, creates a very different experience than sleek European-style cabinets.
The cost of new cabinets can vary widely depending on your choices, but installing new cabinets is often much more affordable than homeowners expect. Money invested in upgrading your cabinets also has such a significant effect on buyer perceptions of your kitchen and your home as a whole that it produces a great ROI.
Countertops and Backsplashes
Modern homeowners have an abundance of options when it comes to countertop materials. From quartz to concrete to butcher block-style wood, there are countertops available in every color and substance. Not all countertops are created equal, however.
While it can be tempting to purchase countertops that are less expensive upfront than granite, no other material will give you the high and reliable ROI that granite will. To get the biggest bang for your buck, ignore short-term countertop fads and invest in granite.
Backsplashes are an extension of your countertops. Like cabinets, backsplashes directly contribute to your kitchen’s appeal and functionality. While relatively inexpensive, backsplashes carry a lot of visual weight.
Colorful backsplashes can brighten up a room and draw the eye. Traditional white or taupe backsplashes can enhance the classic appeal of traditional kitchen designs.
Investing in a backsplash that ties together your cabinets and countertop for a seamless, clean, and coordinated overall impression is always money well spent and a choice likely to give you a good ROI.
Nearly 70 percent of homebuyers are willing to pay more for homes with updated appliances. Nowhere is this more true or more important than in the kitchen.
To get the highest ROI on your appliance upgrades, talk to a realtor about what is trending in your market. In most cases, buyers are interested in appliances that are:
- Smart-device enabled
- Coordinated with each other and the rest of the space in color and style
You may also want to choose appliances that align with modern lifestyles. For example, state-of-the-art refrigerators often include features such as:
- PowerFreeze settings
- Hot and cold filtered water dispensers
- LCD door screens for managing to-do lists and family photos without clutter.
These types of perks can make your home stand out to busy on-the-go professionals and families.
Similarly, appliances that make your home more accessible can be a game-changer. For instance, wall ovens can make your home more appealing to individuals or families with limited mobility.
According to expert predictions, nearly 30 percent of American households will have one or more members with mobility limitations by 2050. Homes with features that accommodate these family members will have a tremendous edge over non-accessible homes in the marketplace.
Refinishing existing wood floors in your kitchen as part of your remodel can give you a rare 100 percent return on investment. Replacing your existing floor with new wood floors is almost as good, with an average 91 percent ROI.
Hardwood floors are singularly attractive to buyers due to their:
- Ability to be refinished rather than replaced
In many markets, buyers will pay several thousand dollars more for homes with hardwood. Hardwood floors can cost more than twice as much as manufactured wood, also called laminate, however.
With this in mind, it is important to scale your flooring choices to your home and your market to get the best ROI.
- Luxury homes in high-end markets will give the best ROI for expensive hardwood floors
- Mid-range homes achieve the best ROI when outfitted with high-end laminate or less-expensive hardwoods
- Homes in lower-cost markets see the best ROI with well-chosen laminate
As with other kitchen features, it is important to select flooring that matches and compliments the overall color and style of your kitchen. Whenever possible, select flooring that makes your kitchen appear larger and brighter.
Sellers are often surprised by the ROI they can get on their kitchen remodels as the result of thoughtful finishing touches. These include:
While individually these things are small and inexpensive, together they have a significant impact on the final product. Failing to touch up these key features can detract from the rest of the work you put into your renovations.
Kitchen Remodels vs Other Remodels
It can be comforting to know that even if you don’t achieve the highest possible ROI on your kitchen remodel, you are still likely to come out ahead. Kitchens rank so much higher than any other home features on buyer priority lists that even lower-ROI kitchen projects can give you more of an advantage when selling your home than a higher-ROI renovation of a less-important room or space.
To put this in perspective, buyers place a full 30 percent less importance on the master bedroom and nearly 40 percent less importance on the living room than they do on the kitchen. This means that funds invested in kitchen renovations do more for your ability to sell your home than dollars invested in almost anything else.
Other Benefits of a Kitchen Remodel for Sellers
It is also important to keep in mind that while return on investment is important, it isn’t everything. Remodeling your kitchen can offer a host of other valuable benefits that are just as important, if not more so, than the dollar amount of the ROI you’ll get when you sell.
Nearly all homeowners who remodel their kitchens experience an overwhelming “joy factor.” A full 90 percent report enjoying their own homes significantly more for the duration of their ownership after a remodel. That happiness is only the beginning, however.
- A full third of renovators had healthier lifestyles post-remodel
- About half enjoyed more quality time with friends and family
- Forty-one percent did more cooking at home for health and pleasure
These direct results can pay even more indirect dividends. For example, at-home family mealtimes are linked to a reduction in risky behaviors and negative outcomes among children and teens. These include drinking, smoking, poor school performance, and poor mental health.
Renovating your kitchen is likely to enable you to live better and to live happily in your current home for longer.
Remodels Can Decrease Time on Market
Finally, remodeling your kitchen can reduce the time your home spends on the market when you’re ready to sell. This results from a variety of interconnected factors.
- Buyers perceive your home as more desirable than comparable homes
- Buyers perceive your home as being higher demand due to its appeal
- Buyers feel more pressure to move quickly to secure your home than they would less appealing homes likely to linger on the market
Selling your home quickly can help you:
- Get the best possible sale price
- Get attractive terms at closing
- Save money on realtor and selling fees
Renovations can also help you avoid costly, last-minute repairs and upgrades during the sale process. With a newly-remodeled kitchen, you can go into the selling process confident that everything is up to code and in good working order. You won’t be surprised by unexpected finds during the inspection phase or slowed down by buyer demands for repairs or compensatory price reductions.
While these advantages are impossible to accurately figure into your ROI, they are clear benefits waiting to be reaped from a thoughtful and appropriate kitchen renovation project.
Start Your Remodel Today
There’s no question that remodeling your kitchen will increase home value and give you a serious advantage when you’re ready to sell your home. But planning a remodel that gives you the best possible ROI can be challenging. We’re here to help.
Browse our product pages for inspiration or check out our blog for information on the leading home trends and materials you’ll want to use in your project today.