Homeowners often wonder whether performing home renovations is actually useful in terms of resale value, and if so, which upgrades give the biggest bang for their buck. Not all renovations pay off in the end when it comes time to resell, but others offer a high ROI. Planning your home updates for areas that offer the biggest impact will ensure you get the best return when selling, while also giving you useful upgrades to enjoy while you’re still in the home yourself.

Biggest ROI: Kitchen Remodel

Time and again, kitchen remodels have shown to provide the highest returns for the investment. Minor kitchen remodels can offer up to 95% ROI. A “minor” upgrade includes anything that improves the aesthetics and functionality of the space without doing major construction (such as removing walls or changing the layout of the space).

Kitchen renovations that have the highest return include adding integrated storage, new lighting, upgraded cabinets and countertops, and putting down new flooring. If you don’t have a huge budget, however, even a new coat of paint on the walls and cabinets can give the room a major refresh.

If your kitchen has a cumbersome layout or lacks storage and additional space to add more, working with a custom home builder for a more extensive remodel is often worth the investment. The kitchen is perhaps the primary space potential buyers will notice while making a decision, so this room is the most important when it comes to “wow” factor.

Potential Considerations:

While kitchen upgrades almost always pay off, it’s important not to overremodel for your neighborhood. Kitchen upgrades have the biggest ROI of home upgrades, but they are also some of the most costly up front. When choosing which aspects to focus on, be sure to match local market expectations so you don’t overspend.

Bathroom Updates

Bathroom renovations consistently offer strong ROI, especially when making midrange updates. These can include replacing your vanity with a modern upgrade, updating faucets and other fixtures, refreshing tile on the floors and tubs, and adding new lighting. A fresh coat of paint can also make a huge difference to bathroom interior design.

If you have the budget and space, adding a walk-in shower and separate tub is a popular choice that get buyer’s attention. Additionally, if your bathrooms have poor ventilation or moisture problems, addressing those issues is crucial because noticeable moisture damage, such as peeling paint or mildew, is a major red flag for buyers.

Landscaping and Exterior Upgrades

Never underestimate the value of curb appeal when it comes to selling your home. Even the smallest updates can make a huge difference. For instance, in some markets, replacing your front door has shown an ROI of up to 100%.

If you’re on a tight budget, small upgrades such as painting exterior structures, power washing siding, and refreshing plants in your landscaping can have a big impact on curb appeal. Pathway lights and entryway lighting also show good returns, and can be purchased relatively inexpensively.

Homeowners with a little more money to work with should consider adding patios, decks, pergolas, and other outdoor areas that extend a home’s living space with outdoor spaces for relaxation and entertainment.

Additionally, if your roofing needs repairs or replacement, now is the time to seriously consider having this done. Roof issues are a major cause of home structural damage and mold growth, and are a huge turnoff for potential buyers. Having an updated roof will instantly improve your home’s resale value, but having one that is noticeably showing its age will have the opposite effect.

Energy Saving Upgrades

Homebuyers in today’s markets are increasingly impressed by energy savings and smart features when home buying. This can include LED lighting, energy-efficient windows, smart thermostats, and updated insulation in crucial areas like exterior walls, attics, and crawl spaces.

Having your home assessed for areas where energy efficiency could be improved may be a worthwhile investment.

Putting it Together

Focusing on strategic renovations in high-impact areas will have the greatest ROI. These include kitchens, bathrooms, and exterior upgrades. Before getting started, you should keep in mind the resale value in your neighborhood. Research market trends before you commit. Additionally, focus on quality vs quantity. A few well-done upgrades will have a bigger impact than a long list of poorly executed ones. When in doubt, hire a professional.