Before you get started on that family room addition, take a moment to consider its potential return. Each year, Remodeling magazine's Cost vs. Value Report provides a fascinating look at the percentage of a home improvement project's costs that are likely to be recouped at resale. The report finds that not all home remodeling jobs are created equal—you'll probably get more of your investment back after building a wooden deck, for example, than adding a sunroom.
To help consumers better understand which jobs offer the highest potential returns, we used the 2009–2010 Remodeling Cost vs. Value Report to compile a list of the 5 best—and 5 worst—home improvement projects for your money:
The 5 Best
1. Steel entry door replacement: Homeowners who install a steel front door recoup on average nearly 129 percent of the project's cost when they sell the home, according to the report. Sal Alfano, the editorial director Remodeling magazine, says that's in part because a steel door is less expensive than the alternatives. A fiberglass front door replacement project, for example, costs about three times more than a steel door replacement, according to the report. But a steel door can still be attractive enough to boost your home's curb appeal. "A brand new door makes a big first impression on somebody who is looking at the house," Alfano says.
A steel door can also make a home more energy efficient, says home improvement expert Danny Lipford. "Steel most of the time has a magnetic weather stripping," Lipford says. "So you close it and that magnetic weather stripping seals it up very nicely." But Lipford cautions that while steel makes for a nice painted surface, it doesn't work with all design tastes. "If you are going for a stained look, a rich wood look, you can simulate the stain, but as soon as you knock on [the steel door] you know that it has an unrealistic look to it."
2. Attic bedroom: Homeowners who turn their dusty old attic into a functional bedroom recoup on average about 83 percent of the project's cost when they sell the home, according to the report. At around $49,000 a job, converting an attic into a bedroom is certainly more expensive than replacing your front door. But when it comes to adding new livable space to your home, building an attic bedroom is often easier on your budget than the alternatives. A family room addition, for example, can run around $83,000. "When you are adding to the footprint of the house you have foundation costs, dirt work, and all of that," says Paul Zuch, the president of Capital Improvements. "But if you are doing an attic conversion you don't have all of those."
At the same time, modern households can encounter all sorts of scenarios that require additional living space. "Whether it's because an elderly parent is moving to the house and is taking the first floor suite and so the kids are moving upstairs, or a child has come back to live with the family after graduating from college," Alfano says. When faced with situations like this, an attic bedroom conversion can sometimes be your best option.
3. Wood deck addition: Homeowners who add a wooden deck to their properties recoup on average nearly 81 percent of the project's cost when they sell the home, according to the report. Celia Kuperszmid Lehrman, deputy home editor at Consumer Reports, says the wooden deck's appeal is linked to today's more thrift-conscious consumers, who are looking to save money by spending more time at home. "Since they are staying home they want to enjoy their exterior, they want to enjoy their outdoors," Kuperszmid Lehrman says. "So [adding a deck] is one of those areas that can add value." Like steel, the popularity of wooden decks is also associated with costs. A similar project built from composite materials can run you about 50 percent more. Lipford, meanwhile, highlights another key benefit of building a wooden deck. "That's not heated and cooled space, but it is an opportunity to make you feel like you have a lot more space in your home than you actually have," Lipford said.