April 01, 2025
Renovation ROI: Which Upgrades Deliver the Best Long-Term Value?
Renovating your home is a smart investment, but it’s important to be strategic about the projects you choose. Not all upgrades offer the same return, with some providing a high return on investment (ROI) while others may not recoup their costs.
Whether it’s a kitchen update, adding a bathroom, or enhancing curb appeal, selecting the right upgrades can make a big difference when it comes time to sell, getting you the most out of your investment.
Let’s explore the renovations that provide the best return on investment based on recent industry data.
The Long-Term Impact of Renovation ROI
Home renovations can increase property value and attract potential buyers. However, ROI varies depending on the type of project, market conditions, and buyer demand.
According to JLC’s 2023 Cost vs. Value Report, high-ROI renovations tend to be practical and functional rather than purely aesthetic. Strategic investments, such as energy-efficient upgrades and kitchen remodels, tend to yield the best long-term financial benefits.
Understanding Home Renovation ROI
Renovations like kitchen remodels, bathroom updates, and even finished basements can significantly boost your home's market value, with ROI percentages ranging from 70% to 83%. Knowing which projects yield the best returns can help maximize your financial gain.
Best Renovations to Increase Home Value
Here are the home improvement projects with the best ROI:
1. Kitchen Remodels: High ROI and Buyer Appeal
A well-designed kitchen is a major selling point. Even minor upgrades can offer a significant return:
Minor Kitchen Remodel (Midrange): Costs around $26,790 and adds approximately $22,963 to resale value, recouping 85.7% of the cost. (Source: JLC 2023)
Major Kitchen Remodel (Upscale): Costs $77,939 and adds about $32,574 to home value, recouping 41.8% of the original cost. (Source: JLC 2023)
Best Value Kitchen Upgrades:
✔ Refacing or painting cabinets instead of replacing them
✔ Upgrading to energy-efficient appliances
✔ Replacing outdated countertops with quartz or granite
✔ Updating lighting and hardware for a modern look
2. Bathroom Upgrades: Smart Improvements That Pay Off
Bathrooms are another key area where renovations can provide solid returns:
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A midrange bathroom remodel costs about $25,251 and adds $18,613 in value to the home. (Source: Bankrate, 2024)
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Modern features such as walk-in showers, energy-efficient fixtures, and updated vanities improve both functionality and resale value.
Top Bathroom Renovation Tips:
✔ Upgrade outdated faucets, lighting, and hardware
✔ Swap an old tub for a sleek walk-in shower
✔ Install water-saving toilets and energy-efficient fixtures
3. Energy-Efficient Enhancements: Savings and Value
Sustainability is a growing priority for homeowners, and energy-efficient upgrades can provide both short-term savings and long-term value:
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New Energy-Efficient Windows: Costs $21,264 for ten windows, recouping 67.5% of the original cost in added value to the home. (Bankrate, 2024)
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Upgraded Insulation: One of the most cost-effective improvements, reducing energy bills by up to 15%. (U.S. Department of Energy)
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High-Efficiency HVAC Systems: Increases home value and saves hundreds annually in energy costs.
Best Energy-Saving Upgrades:
✔ Replace old windows with double-pane energy-efficient models
✔ Improve insulation in walls, attic, and crawl spaces
✔ Upgrade to a high-efficiency HVAC system
Choosing the Right Remodeling Projects for Your Budget
If you’re working within a budget, smaller updates can still make a big impact.
Cost-Effective Cosmetic Updates
Even minor improvements can freshen up your home and improve its resale value.
Fresh Paint: A gallon of paint costs around $30-$50 and can yield up to a 200% ROI.
Modern Light Fixtures: Installing new lighting can provide a high return with minimal cost.
Refinishing Hardwood Floors: Costs $3,400 on average but can return 147% of the cost. (National Association of Realtors, 2023)
Adding Functional Living Space
Expanding usable space is one of the best ways to increase home value.
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Finished Basements: These offer an ROI of 70-75%, depending on location and quality of work. (Source: Angi.com)
Attic Conversions: Transforming attic space into a bedroom or office can yield an ROI of 70%. (Source: Clearly Company, 2022).
|
Renovation Project |
Average ROI (%) |
|---|---|
|
Minor Kitchen Remodel |
~80% |
|
Bathroom Remodel (Midrange) |
~70% |
|
Energy Efficient Windows |
~70% |
|
Garage Door Replacement |
~103% |
|
Hardwood Floor Refinishing |
~150% |
|
Insulation Upgrade |
~100% |
(Sources: JLC 2023, Bankrate 2024, NAR 2023)
Final Thoughts: Making Smart Home Improvement Choices
By prioritizing renovations with strong returns, homeowners can maximize their investment while enjoying the benefits of a more functional and beautiful space.
Need expert guidance on your renovation project? DeLeers Construction specializes in high-quality remodeling projects that enhance both functionality and value. Contact us today to get started!
Message or call our experts at 920-347-5830 with any questions on hiring professionals for your home renovation or rebuilding!
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