There are a lot of factors to consider when you are remodeling your home. One consideration is how the improvements will affect your home’s value.

On this front, I have good news and bad news for you. The good news is that remodeling will almost always cause your home’s value to increase. The bad news is that the increase is almost always less than your monetary investment.

Remodeling magazine has compiled extensive data on this subject. They produce an annual “cost vs value” report in which they take the average costs for select remodeling projects and they compare these costs with the value the projects will retain upon the sale of the home.

When we look over the past ten years of data for our region, New England, here is what we will find:

A “Minor Kitchen Remodel, midrange” will generally retain between 70% and 87% of its value, with 70.3% being the average for 2021.

A “Major Kitchen Remodel, midrange” will generally retain between 55% and 74% of its value, with 55.1% being the average for 2021.

A “Major Kitchen Remodel, upscale” will generally retain between 53% and 67% of its value, with 53.9% being the average for 2021.

A “Bath Remodel, midrange” will generally retain between 56% and 74% of its value, with 62% being the average for 2021.

A “Bath Remodel, upscale” will generally retain between 50% and 64% of its value, with 55.6% being the average for 2021.

You can find all of the data, including the definitions of the projects cited, here: https://www.remodeling.hw.net/cost-vs-value

This data is based on regional averages. Every home is different and every project is different, so you should consult a real estate agent or property assessor to get a more accurate assessment of how a project would affect the value of your home.

Even though your home will be unique, we can still glean some good information from the regional data referenced.

For one thing, none of these projects retained 100% of their value, let alone exceeded it and created a “profit”. Certain projects on certain homes can create a profit situation, where the increase in home value is more than the financial investment of the project. But, we can see from the data that this is not typical.

Another notable fact is that the larger or more expensive the project, the less value it will retain upon resale. The “minor kitchen remodel”, for example, has a 70.3% return on investment, whereas the “major kitchen remodel” has a 55.1% return. The same is true of the difference between the midrange and upscale projects. More expensive projects generally have a lower rate of return.

The limitation of this data is that it doesn’t take into account the non-financial value a home improvement project will provide. This is why we recommend taking the cost vs. value report with a grain of salt. Very few homeowners are considering a home improvement project solely as a financial investment. Most of us are considering it for quality of life reasons.

In our professional opinion, quality of life should be your primary focus when you are considering a remodeling project. We believe that it would be a bad idea to choose products that you won’t enjoy simply because they would be considered better investments from a financial perspective. You will live with your transformed space every day of your life, and a space that makes you happy is worth infinitely more than a space that makes you regret your decisions. Having a home that fills your heart with joy can be priceless!

However, it is helpful to know that, should you choose to sell your home, you will be able to recover much of your investment. This is the value we see in using the “cost vs. value report” data.

You may choose to invest $50,000 into a bathroom remodel, for example, with the plan of spending your next 20 years enjoying it. You can rest easy knowing that if something happens in your life and you choose to sell your home, you won’t be losing all $50,000 of your investment. Your increased home value will allow you to recuperate around $31,000 of that investment (based on regional averages, your mileage may vary).

Wouldn’t it be great if the other quality of life investments we make, like electronics, clothes, or decorations, retained this much of their value!

Basically, what I’m saying is this: A home remodel is an investment in the quality of your life. When a remodel is done well, its effect on your life can be priceless. But, when life happens and things don’t work out the way you planned, you can rest assured that you will recoup much of your financial investment when you sell your home. The amount you can recoup varies, but in New England, and with kitchen & bathroom remodels, it will typically be between 54% and 70% of the cost of the project. That’s not a bad deal!