Home renovations can sometimes be daunting more often than not. In fact, in 2020, the demand in the home renovation industry has increased by at least 40% compared to the previous year. In addition, the steady rise in global housing markets and the 4.5% yearly increase in home prices show that investing in renovating your home and reselling it is the best way to increase your profits. This article will tell you everything you need to know about home renovations as a piece of investment — from costs to reselling.
Do Your Research
If you are looking to resell a home, you first need to do your homework. Figuring out your target market and their preferences—in terms of home location and other factors—will help you collaborate with the right real estate agents. It also allows you to determine the level of professional assistance needed and help peg the reselling price that can be offered.
Understanding the potential buyers for the home and what kind of home would appeal to them already provides significant insights. Design and use of space can target the types of individuals or families who are attracted to the home you are offering. Is it going to be just right for a single person, or will there be a space for couples to eventually grow their family? Buyers are most interested in the quality and design of the home. Professional assistance from interior designers, landscape architects, garden designers, and architects is a selling point that would increase the value of the home.
Another thing, as they say, is location, location, location. Accessibility to town centers, health centers, and education facilities will help drive the base selling price of your home. Certain locations attract groups with similar household incomes, which is a factor in determining the “affordability” of the home. Real estate agents are helpful in finding the right target market and setting the appropriate selling price for the home.
Costs
You can’t begin a home renovation without knowing the costs of the project. Costs of renovations will depend on three factors: location of the house, space (or spaces being renovated), and the size of the house. These are some of the average costs (in USD) based on the area of renovation:
- Kitchen renovation – USD 19,100 / USD 150 per square foot
- Bathroom renovation – USD 11,700 / USD 250 per square foot
- Bedroom renovation – USD 7,880 / USD 100 per square foot
- Living room renovation – USD 7,264 / USD 30 per square foot
- Basement renovation – USD 15,000 / USD 90 per square foot
- Roof replacement – USD 5,351 to 10,831 / USD 8,052
For a full picture, a complete house renovation would cost an average of USD 44,000 to 75,000. The numbers are quite overwhelming to look at. But If you’re looking to invest in renovating your home, this is where you begin. Renovation costs can be much cheaper than rebuilding an entire home from scratch.
Renovations
Renovating to adapt your home to architectural and interior design innovations can be vital in getting a good price for it. It is best to get professionals to provide quality renovation services such as commercial roof repairs, landscape architecture, interior design, plumbing, and electrical services. In this sense, renovation becomes your investment in increasing the value of the real estate property. You can easily get a return on your investment or break even on the costs of the renovation. Or your profit could even exceed the costs of your renovation expenses.
Reselling
As previously mentioned, the average costs of a home renovation project have multiple factors. They could be costly, which is quite a feat. But there is a net profit to be earned after selling your home. Are you looking to increase your profits? Then real estate is the perfect place to invest in.
A full home renovation could increase the value of your home by 56%. Renovating even just a portion of your home will add a significant amount to that percentage. If you are not seeking to resell your home, the satisfaction you get in renovating and updating your home to the latest changes in interior design and home remodeling is also worth it.
In recent years, home remodeling and reselling have increased in demand and prices respectively, which can be advantageous for those who would like to increase their profits. Some things to take note of before you begin to renovate your home and possibly resell it are the target market, location, costs, the area of renovation, and hiring professionals. Renovating your home is a good investment for the future. It could increase the value of your home, whether you’re going to sell the house or not.
