While the percentage of costs recouped are trending downward for all of the replacement projects covered by Cost vs. Value, this change primarily reflects the sharp increase in material costs over the past summer. Material costs tend to comprise a greater proportion of replacement projects compared with larger indoor remodels, which have a higher percentage of labor costs. Provoked by trade tariffs and uncertainty that roiled commodity markets over the summer, lumberyards and supply houses began sending customers regular notices about cost increases, right when the cost evaluations for Cost vs. Value were being completed.
The reason for high returns on exterior projects, and especially facade facelifts, stems from the valuations set by the real-estate community. In order to make the best use of the Cost vs. Value tool, a remodeler has to think like a real-estate broker. “Curb appeal” and “first impressions” are central to a real-estate professional’s estimation of resale value. Granted, a home’s exterior will only persuade potential buyers to see more, and first impressions can vary from one individual to the next. But the impact these impressions make is critical in setting the stage for what a buyer is willing to pay for a home.
The larger discretionary projects, such as kitchen, bath, and master-suite remodels, tend to be too individualized to provide broad, lasting appeal. There is no one best cabinet style or color, no perfect tile or fixture design, that garners universal affinity. Certainly, there are design trends that have wide appeal among a range of homeowners. But because of the vast differences in aesthetic tastes, one person’s elegant new kitchen or bath will be viewed by a range of other prospective buyers as tacky and outdated and in desperate need of a reset.
CONTACT DIANE BELCUORE FOR ADDITIONAL INFORMATION ABOUT REMODELING RETURN ON INVESTMENT BEFORE YOU RENOVATE YOUR HOME! firstname.lastname@example.org 908-872-5473
Posted on January 18, 2020 at 10:08 pm by Diane Belcuore