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All Contents © 2020The Kiplinger Washington Editors
By Andrea Browne Taylor, Online Editor
| May 8, 2019
Homeowners are sometimes hesitant to upgrade when it's time to sell. After all, you won't be living there much longer, and most home remodeling efforts only increase home values by 50% - 80% of the average project's costs, according to Remodeling magazine's 2019 Cost vs. Value report. For example, the average cost of a mid-range bathroom remodel is $20,420. You’d recoup about $13,717 (67.2%) of that amount during a resale.
While you may not want to spend the extra cash, the cost of inaction can be far greater than the small loss you'll incur on any home-improvement projects. "Making small upgrades over time serves a seller immensely," says Brian Lewis, a real estate broker with New York City-based realty firm Compass. These don't have to be break-the-bank alterations, either. Even merely keeping the color palette up-to-date will go a long way. “Getting stuck in time with your home isn't a smart move and is rarely rewarded financially at sale time," he adds. In fact, it may cause your house to linger on the market longer. As a result, you'll likely have to pay ongoing mortgage, maintenance and staging costs.
To make the most of your remodeling budget, focus on features that most home buyers really want to see. Updated for 2019, our slide show reveals home features most coveted by today's buyers. Take a look.
The National Association of Home Builders\' (NAHB) 2019 report "What Home Buyers Really Want" reveals the buying preferences of recent and prospective buyers. NAHB\'s 2018 survey "Features Home Buyers Consider Essential" identifies the most desirable home features among prospective first- and second-time home buyers. Estimated project costs come from HomeWyse.com and reflect the cost of materials and contractor labor, unless noted otherwise.
Percentage of buyers who want this feature: 91%
Cost to install: $1,000 to $5,000 for a small-scale project
More than anything else, homeowners want a room other than the guest bedroom to stack all the clean laundry in until it finally gets put away. A separate laundry room tops the National Association of Home Builders' (NAHB) list of most-wanted home features by buyers. "Having a separate room [to use for things such as folding or ironing clothes] helps to keep the mess out of your living space . . . Potential buyers will see it as a huge benefit," says Paul Sullivan, founder and president of the Sullivan Company, a Newton, Mass., remodeling and custom-building firm.
If you don't have an existing laundry room and want to add one, the basement is usually the easiest (and cheapest) place to put it, Sullivan advises. The utility lines are already there, and in many cases the basement is unfinished, so you won't have to demolish anything first. Adding a laundry room in the basement can cost as little as $1,000, he says.
However, homeowners who prefer a laundry room or laundry closet (which fits just a washer and dryer) closer to the bedroom can expect installation to cost around $5,000, Sullivan notes. The cost of a full laundry room complete with a sink and storage cabinets could easily surpass $10,000, he says.
Percentage of buyers who want this feature: 89%
Cost to install: Varies by appliance
Would-be buyers looking to limit utility bills will likely be drawn to properties with energy efficiencies, such as Energy Star-qualified windows and appliances. "Buyers are most impressed with smart, energy-efficient choices that in no way limit their comfort, but in every way save them money in the long run," Compass’s Lewis says. Sellers should be sure to play up these features in their home listings.
Energy-efficient windows can trim heating and cooling costs by 12%, while individual appliances, such as an Energy Star-certified washing machine ($528 to $1,800 at Home Depot), can save homeowners $45 a year or more on their utility bills. Replacing an existing clothes dryer with an energy-efficient version could save as much as $245 over the appliance’s lifetime.
Energy Star-qualified windows have an invisible glass coating, vacuum-sealed spaces filled with inert gas between panes, sturdier weather stripping than regular windows and improved framing materials -- all of which reduce undesirable heat gain and loss in the home. An Energy Star-certified dishwasher (ranging in price from $230 to $1,709 at Home Depot) uses soil sensors to assess how dirty your dishes are to minimize water use.
Percentage of buyers who want this feature: 87%
Cost to install: $963 per 120 square feet for a concrete patio
It's important for homeowners not to neglect the backyard area when prepping for resale, says Mike McGrew, former treasurer of the National Association of Realtors and CEO of McGrew Real Estate, a Lawrence, Kansas-based realty firm. In today's housing market, outdoor living spaces have become the most coveted outdoor home feature.
"When most buyers see a house with a really nice backyard, they start to envision themselves sitting outdoors with friends having drinks," McGrew adds. Outdoor areas offer more living space without the cost of a large-scale home addition.
Thanks to the popularity of backyard renovation TV shows, such as HGTV's Going Yard, DIY Network’s Yard Attack! and Bravo's Backyard Envy, buyers now envision everything from a traditional ground-level patio to an elevated deck to a backyard kitchen area.
Percentage of buyers who want this feature: 85%
Cost to install: $466 per fixture with light kit and remote control
In addition to improving a home's aesthetic, energy-efficient ceiling fans (ranging in price from $69 to $1,300 at Lowe’s) can also help lower cooling costs when used in conjunction with an air conditioner during the warmer months.
Ceiling fans create a wind-chill effect that helps cool the people sitting in the room. Homeowners should be able to raise the thermostat level by four degrees without a reduction in comfort while the fan is in use, according to Energy.gov.
Energy.gov recommends that ceiling fans only be used in rooms with a ceiling height of at least eight feet. The fans work best at that height and when they're hanging 10 to 12 inches below the ceiling.
Cost to install: $2,025 - $2,363 for 380 square feet
Buyers with growing families need lots of storage space. Sellers should keep in mind that "streamlined living equates to more dollars in your pocket at sale time," Compass’s Lewis says. Carving out some space in your garage to help keep clutter out of the main living area could help your bottom line. "Make sure the bonus space is easily accessible and wonderfully organized," he adds.
Unlike an attic or a backyard shed, the garage is accessible -- generally, just a few steps away from the rest of the house -- making it easier to transport items such as tools, patio chairs or boxes to and from other parts of the house.
The installation cost includes adding cabinetry and shelving, peg wall boards for tool storage, overhead lighting and additional electrical circuits.
Cost to install: $65 per fixture
Illuminating a well-manicured lawn with exterior lighting can help grab potential buyers' attention before they even set foot in the front door. In fact, exterior lighting is the second most-wanted outdoor feature (patio was first), according to the NAHB. Options include spotlights, walkway lights and pendant lights.
Aesthetics aside, exterior lighting also serves as an added safety feature for your home, says Daniel Hurst, owner and general manager of Hurst Design-Build-Remodel, a Middleburg Heights, Ohio-based home remodeling company. Motion-sensor lights, for example, turn on automatically whenever there is movement outside your house.
Percentage of buyers who want this feature: 83%
Cost to install: Varies based on design
Home buyers with families know that the kitchen can quickly become overcrowded when there’s not enough space to store the essentials (think: canned goods, condiments and food storage containers). That's why many are including a walk-in pantry on their must-have list for potential homes. In fact, it was the most-wanted kitchen feature among buyers polled in the NAHB’s report.
Unlike reach-in closet pantries with sliding doors that offer limited space, walk-in versions allow homeowners to store larger quantities of non-perishable food items and other kitchen essentials just steps away from the food prep area, suggests Neil Parsons, project designer for Move or Improve, a Matawan, N.J.-based home design firm. This can be especially helpful for those who like to shop in bulk at warehouse clubs.
Walk-in pantries are typically 5 x 5 feet and have U-shaped open shelves or cabinets with a countertop. Make sure the pantry is situated somewhere that is cool and dry.
Cost to install: $999 per 120 square feet of red oak flooring
Hardwood flooring offers a cleaner look, is easier to maintain and is more durable than carpet, which needs to be replaced every eight to 10 years. "Hardwood can be refinished periodically and lasts a lifetime," Sullivan says.
Sellers on a budget may want to buy engineered wood flooring (which is a hardwood veneer wrapped around several layers of plywood, fiberboard and hardwood). The cost to install 120 square feet of engineered wood flooring is $858 -- nearly 15% cheaper than pure hardwood flooring.
While walk-in closets aren’t among the top demands of all homebuyers, they’re quickly gaining in popularity among first- and second-time homebuyers, according to a 2018 NAHB survey that focused on new buyers. A walk-in closet in the master bedroom ranked among their top five features.
If you live in an older dwelling with a reach-in closet, you may want to consider revamping it, suggests Maria Zamora, a realtor associate with Realty Consultants Network in Addison, Tex. Couples generally want a closet with more space, because they’ll be sharing it. Singles desire the flexibility of being able to store their personal belongings -- from clothes and shoes to jewelry and other accessories -- in one place, while keeping them organized. “Homes without a walk-in-closet in the master bedroom are more of a challenge to sell and will attract less buyers,” Zamora adds.
If you live in an older home with less space, a full closet renovation in the master bedroom may not be practical. However, you still have options that will help make your property more appealing. Update an existing reach-in closet by installing an organization system complete with shelving units and hanging rods for clothes. You can purchase a prefabricated system from Ikea, which range in price from $155 to $2,077. Go the DIY route or have an Ikea professional install the unit for an additional fee. You can also hire a consultant from a custom closet design firm, such as The Closet Factory, to come to your home and design an organization system that fits your space. The cost will vary based on your requirements.
If you’re an empty-nester, you could even turn a nearby smaller room into a custom walk-in closet. Depending on the quality of the materials used (for example, solid wood shelving vs. wooden veneer shelving), this type of project could range in price from $1,000 to $6,500, according to HomeAdvisor.com.
Cost to install: $1,000 - $10,000
Eat-in kitchens are also a must-have among first- and second-time home buyers. They’re especially attractive to families with children. It’s a space where they can congregate in the morning for breakfast before the kids head off to school and parents to work, or in the evening for dinner so everyone can share highlights from their day.
Removing a non-load-bearing wall to create space for a small table and chairs in your kitchen is relatively inexpensive (as little as $1,000), but that price can quickly escalate if your demolition reveals plumbing, duct work and electrical wiring that needs to be removed, Move or Improve’s Parsons says.
If you’re on a tight budget and can’t afford to knock out a wall to create more space for a table and chairs, consider adding a center island with room for bar stools, he suggests. You can purchase prefabricated kitchen islands with space for seating at Home Depot (starting at $540) and Lowe's (starting at $464).
Cost to install: $1,000 - $6,000 to add ceiling fixtures or structural columns to open floor plan
In recent years, formal dining rooms (and closed floor plans) have taken a backseat to open floor concepts in today’s home models. While open floor concepts help maximize space when entertaining, there are still home buyers who desire a separate dining area distinct from the kitchen. In fact, a separate dining room is among the top 10 essentials for first- and second-time home buyers in the NAHB survey. “A meal in the dining room creates a sense of importance . . . It makes people feel special, whether it's for holiday gatherings or a quiet sit-down dinner with your family,” says Shannon Lynch, a realtor with Savvy + Co. Real Estate, a Charlotte, N.C.-based realty firm.
If your home has an open floor plan, there are still ways to create a dining space that’s distinct and will attract buyers who desire such a feature. You can add an over-the-table lighting fixture or incorporate a tray ceiling to help define a particular area of the main living level -- perhaps just off the kitchen. Another option: Install decorative columns instead of a solid wall. Adding the tray ceiling or decorative columns would skew on the higher end of installation costs and includes materials and labor, Parsons notes.
For those with older homes that have a closed floor plan, it may be time to reexamine your dining room. The cost of a small-scale remodel to a 190-square-foot space ranges in price from $5,832 to $6,804, according to HomeWyse.com. This includes installing new flooring, doors, switchplates, decorative hardware and recessed lighting.