Whether you want to fix a safety issue, increase your home’s efficiency, or add more comfort, there are plenty of reasons why you may want to remodel or renovate your home. But before you set out making upgrades, it’s important to consider the project’s cost vs. its value.
The Cost vs. Value Report
The 2021 Cost vs. Value report provides data for 150 metro areas across the United States. The data was derived from an econometric model that used data from existing home sales and values, as well as local gross domestic product (GDP), among other factors.
We took a look at the 2021 Cost vs Value Report for the Chicagoland area. Here’s what we found:
Focus on exteriors.
Real estate professionals say the first impression you make on a buyer can play a big part in a potential sale. This year, consider a façade facelift because 9 out of the top 10 projects with the highest return on investment (ROI) in Chicagoland are exterior projects.
With cold Chicago winters, home improvement projects that both improve your home’s exterior and its heating efficiency are high on the list. Exterior projects are not only practical in protecting your home from the elements, they also make your home more attractive on the market.
|Project||Job Cost||Resale Value||ROI|
|Garage Door Replacement||$4,132||$3,967||96%|
|Manufactured Stone Veneer||$10,998||$9,788||89%|
|Entry Door Replacement (Steel)||$2,303||$1,653||71.8%|
|Window Replacement (Wood)||$25,045||$17,696||70.7%|
|Window Replacement (Vinyl)||$21,564||$15,121||70.1%|
|Siding Replacement (Vinyl)||$20,679||$14,434||69.8%|
|Minor Kitchen Remodel (Midrange)||$31,004||$21,184||69.6%|
|Deck Addition (Wood)||$19,935||$13,328||66.9%|
|Siding Replacement (Fiber-Cement)||$24,321||$15,985||65.7%|
|Deck Addition (Composite)||$24,592||$15,503||63%|
Upgrade the kitchen.
20% of real estate agents say completing a kitchen upgrade played a big part in closing a home sale.
In fact, the only indoor renovation that makes the top 10 on both the national and Chicagoland 2021 Cost vs. Value report is a minor kitchen remodel. While organizing a full remodel could come with a bigger investment, smaller-scale kitchen renovations such as replacing appliances or painting cabinets prove to get a big bang for your buck; the average minor kitchen remodel can cost around $26,000 with a ROI at 72%. In Chicago, it can cost around $31,000, with an ROI of 69.6%.
Add a deck or patio.
Coming in at number 8 for project value recouped—both Chicago and nationwide—is a deck addition. Decks are a great way to add some usable space to your home and increase your resale value. The national average cost for a deck or patio addition is $16,766 and that project nets you a 66% ROI.
However, the rising material costs over the last few years must be considered. The cost data in the Cost vs Value report included a standard mark-up of 10% on materials and 10% on labor. Lumber especially has seen a sharp increase. According to the report, a wood deck project shows the greatest decrease in ROI (-10.3%) and the highest increase in material costs (+13.6%).
Yet, these increased material costs aren’t necessarily a bad thing; as the value recouped is still there.
Typically, composite decks are much more expensive than traditional wood decks, but with the cost of lumber rising, composite decks aren’t much higher in price, and often last longer than wood. A composite deck in the Chicago area that costs $24,592 gets a $15,503 recouped value, or 63% ROI. Consider your options and compare what’s available near you, because the end result is useful outdoor space for everyone to enjoy.
Looking to the future: The value of the home office
With more employees transitioning to work-from-home roles due to the pandemic, the desire for a comfortable home office space is becoming more and more important.
We’re predicting an increase in the cost vs. value for home offices, as well as spaces that allow us to “get away” while under the same roof—spaces like a home gym or basement media room, for example.
While a project’s cost vs. value is important to consider when remodeling or renovating your home, it’s just one of many considerations. At the end of the day, being comfortable in your living space is as good a reason as any to tackle that next project.