Alison,
You have gotten some great answers here. But keep in mind that there are many factors to consider beyond generalizations of what buyers "want." It is also a matter of what buyers can afford. I would ask first what improvements the house and the neighborhood market will support.
For instance it is a pretty safe bet that most buyers want a second bathroom but that isn't always feasible in small, older houses without a lot of space to begin with. And that goes for expanding the kitchen, as well. If you are in a neighborhood of 2 bedroom/1 bath homes, you may be creating a higher sales price than the potential competition. And if you are considering selling in the current market (that is within the next year or so) the lower the asking price, the more potential buyers you will attract, e.g. the more buyers there will be that can qualify for the loan.
I always thought of "sweat equity" as things that most every unskilled homeowner could do themselves: yard work, interior and exterior painting, vinyl flooring, and maybe some light carpentry, etc. But when you start considering adding rooms or modernizing kitchens and baths, that is renovation and usually best left to the professionals. And using professionals really drives up the costs.
I have included a link that has some great generalizations for professional remodeling costs vs. value.
http://www.costvsvalue.com/seattle.html
Good luck!
- Wed Jul 2 2008, 10:21