It’s a greige kind of year, or so says Remodeling
magazine in its 2017 Cost vs Value report
. The 30-year-old study, which analyzes the costs of various remodeling projects and their projected returns on investment, tells a story this time of small improvements year-over-year. The report is neither bold, nor bland. Not gray or beige. But greige.
On average, the reviewed projects returned approximately 64.3 cents on the dollar in resale value, or three-quarters a penny more than was reported in 2016. Predictably, curb appeal projects yielded higher returns than interior renovations, and putting loose-fill insulation in the attic was the sole project to return a higher value than its cost. Still, the news is positive for kitchen and bath remodelers. In fact, upscale bathroom additions on average experienced the biggest year-over-year percentage increases in values. Here are the numbers:
- Major kitchen remodel mid-range: cost is up 3.6 percent and the value is up 4.2 percent
- Major kitchen remodel upscale: cost is up 2.6 percent, and the value is up 3.3 percent
- Minor kitchen remodel mid-range: cost is up 3.5 percent, and no change in value
- Bathroom remodel mid-range: the cost is up 3.6 percent, and the value is up 2.2 percent
- Bathroom addition upscale: the cost is up 2.7 percent, and the value is up 3.3 percent
- Bathroom addition mid-range: the cost is up 2.4 percent, and the value is down 1.9 percent
Of course, these figures are a national average. The numbers vary a great deal when the report drills down into regions. For instance, Pacific Coast states saw an average payback of 78.2 percent for all projects, while East North Central states experienced an average return of 54.9 percent.
The editors at Remodeling
further point out that housing data specialist Metrostudy forecasts professionally done remodeling projects worth at least $1,000 will increase 4.4 percent this year. Why? As mortgage rates increase, homeowners will be more apt to stay put and renovate their existing homes. For those in the business of remodeling, that’s great news. Or should we call it “greige” news?