- Bargaineering - http://www.bargaineering.com/articles -

2009-2010 Best Value Home Renovation Projects

I like taking a look at this list [3] every year because it gives me a good understanding of what makes a good renovation project, in terms of ROI, and what makes a terrible one. When it comes down to it, I know it’s not about ROI. You don’t add a deck to your house because of the ROI, you add one because you want a deck. You put a bedroom above the garage not because some book says the ROI is high, you do it because you want a place your guests can stay that beats an air mattress in your study.

However, if you have several projects on the list and you aren’t sure which one to take on first, a list like this could help break the tie.

I haven’t looked at the list since 2008-2009 [4] but not much has changed. Back then, the best renovation you could do was the addition of a deck, with a recoup of 81.8%. This year, the best major project is the addition of an Attic Bedroom (wood deck addition came in #2).

Project 2008 Recoup % 2010 Recoup %
Attic Bedroom 83.1%
Deck Addition 81.8% 80.6%
Siding Replacement 80.7% 79.9%
Minor Kitchen Remodel 79.5% 78.3%
Window Replacement (Wood) 77.7% 77.3%
Window Replacement (Vinyl) 77.2% 76.6%

As you can see, the recoup values have fallen a little, which I believe reflects the softer housing market, but they’ve been falling a few fractions of a percent every since I’ve been looking at the list. One interesting note from the original list is that there is one midrange project that is “profitable,” replacing the entry door (steel) with an ROI of 128.9%. It’s a cheaper project ($1,172) so getting a return isn’t as difficult, especially when it’s such a big aspect of curb appeal.

Worst ROI project is a home office remodel (48.1%) and the addition of a sunroom (50.7%). However, like I said earlier, sometimes you want to do a project because you’ll enjoy it, not because of the ROI. Sunrooms are great if you love them… but they won’t make you any money. 🙂