Remodeling Looking up in 2012
Homeowners are ready to make 2012 a banner year for remodeling and the latest cost-for-value research suggests that getting the most bang for every buck is more important than ever.
The Remodeling Market Index (RMI) hit a five-year high at the end of 2011, indicating that residential remodeling should continue to grow in 2012, according to panelists at a press conference at NAHBâ€™s International Buildersâ€™ Show. After a slow start, home improvement spending is expected to trend up later this year, according to the Leading Indicator of Remodeling Activity (LIRA) released by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. If this momentum continues to build during the second half of the year, remodeling activity is on course to end 2012 on a positive note.
However, consumers want to get the most for their money.
Remodeling Magazineâ€™s annual Cost vs. Value report for 2011-2012 found that the trend right now is replacement over remodelingâ€”swapping out the old for the new rather than doing a total gut job, which can be much more costly. Exterior replacement projectsâ€”such as new garage doors and a new entry doorâ€”offer some of the best returns at resale, allowing home owners to recoup close to 70 percent or more of the costs of the project at times of resale.
The following are the top, mid-range projects from this yearâ€™s report, based on what home owners stand to recoup at time of resale:
1. Replacing the entry door to steel
Estimated cost: $1,238
Cost recouped at resale: 73 percent
2. Attic bedroom (converting unfinished attic space into a bedroom with bathroom and shower)
Estimated cost: $50,148
Cost recouped at resale: 72.5 percent
3. Minor kitchen remodel (including new cabinets and drawers, countertops, hardware, and appliances)
Estimated cost: $19,588
Cost recouped at resale: 72.1 percent
4. Garage door replacement
Estimated cost: $1,512
Cost recouped at resale: 71.9 percent
5. Deck addition (wood)
Estimated cost: $10,350
Cost recouped at resale: 70.1 percent
6. Siding replacement (vinyl)
Estimated cost: $11,729
Cost recouped at resale: 69.5 percent