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Home Remodeling Projects That Offer the Best Return on Investment

man painting inside home while woman and child look on



Home renovations should, first and foremost, improve your home and make it a more enjoyable place to live. But, before taking on any home improvement project, you should consider the return you will get on your investment. This is especially true if you're getting ready to sell your home in the near future.


No project recoups all the money you dump into it, but some come close. Let's look at some of the most common home projects and what you can expect back after you invest your time and money.


Key Takeaways

  • Unlike home improvements, home maintenance does not increase the value of your home.
  • Top projects to increase the value of your home include adding stone veneer, replacing a garage door, minor kitchen remodels, and window replacement.
  • Paint colors can impact the value of your home, with black doors and pinkish taupe living rooms raising the value, while red kitchens lower it.
  • Major remodels in kitchens and bathrooms add more value while you are living there and only see a 53-64% return on investment for resale.

No Increase in Value From Maintenance

First, keep in mind the difference between home improvements and home maintenance. Replacing your old, broken-down furnace does not increase your home's value. It just makes it possible to sell the home.


However, installing dual-pane windows to increase heating efficiency does add value because buyers can perceive the benefit they'll receive from that improvement in lower heating costs.


Top Exterior and Interior Improvements

Every year, Remodeling Magazine releases a cost vs. value report that examines remodeling costs and the resulting increase in home value at resale to determine which projects offer the best return on investment.


Among 22 home improvement projects in the 2021 report, nine out of the 10 best-returning jobs nationwide involved the exterior of the home.

  • The best-performing project was replacing a garage door, which had an average cost of $3,907 and an average increase in home value of $3,663, for a return of 93.8%.
  • In second place was a manufactured stone veneer, which returned an average of 92.1%. The average cost was $10,386, and the average gain in home value was $9,571.
  • The highest-ranked interior remodeling job was a minor kitchen remodel in a midrange home, which returned an average of 72.2% after costing $26,214 and increasing value by $18,927.
  • Fiber cement siding replacement was the next highest-returning project, with an average cost of $19,626 and a return of $13,618 (69.4%).1

Paint Colors

The colors you choose to paint your home inside and out can make a difference in its resale value. Painting goes above and beyond routine maintenance. It increases or decreases visual appeal to buyers and so can result in a higher or lower offer.


The Zillow paint color analysis looked at the effect various paint color choices in different locations throughout the house had on the actual sale price of the home when compared to its estimated value.


The analysis drew some surprising conclusions. For instance, a black front door increased the sale price of a typical U.S. home by 2.9%, while pinkish taupe was the best color for a living room, increasing the home price by 1.3%. A losing color for the kitchen is brick or barn red, which dropped the price of a home by $2,310.2


Kitchens and Bathrooms

Many long-time homeowners feel they must refresh their kitchen and bathrooms before selling if they've remained the same for many years. These jobs, though, seem to pay off more in pride for the homeowners while they're still living there than they do in return on value at resale, especially when it comes to expensive homes.


According to the cost vs. value report, a bathroom remodel in a midrange home returned only 60.1% on the average investment of $24,424. For an upscale home, the return was even worse: 54.8%, based on an average cost of $75,692.


A similar pattern emerged with kitchens: A major kitchen remodel in a midrange home returned 57.4% on an average investment of $75,571. A major remodel in an upscale home was the worst of the four projects. Its return on investment was 53.9% on average after a typical project cost of $149,079.1


The real value in those types of remodels is the enjoyment you get out of them. If you're not planning to stay long, you may want to think twice about a kitchen or bathroom remodel.


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