Home Improvement: Is it Worth the Cost?

Determining Cost Vs. Value of Home Improvement

As a homeowner, you have probably faced the dilemma of home improvement. You see the what changes you would like to make, but you don't know how far to go or how much to spend. There are several things to consider when planning a home improvement project that will help you determine what changes you should make, and how much is appropriate to spend.

When I consider a home improvement project, I first have to look at not only what I want to do, but why I want to do it. On one side I consider whether or not the improvements will increase the value of my home. Some projects, like adding a second bathroom, or finishing the basement, have been shown to add value to a home. Figuring out how much value is simply a matter of looking at real estate prices in your area, and comparing price differences between homes that have a second bathroom (or finished basement), and those that don't. That price difference will give you an idea of how much you can spend on the project without losing money. There are also some projects that may not add value, but not doing the project will certainly hurt the resale value. Replacing the carpets or painting the wall will not add value to your home. However, by not keeping up with the maintenance of your home, the amount a buyer will be willing to spend will certainly decrease.

The second thing I consider is more of a quality of life issue. There are some projects I undertake, not for the added resale value, but because it is a home my family lives in. There is a value we gain from these projects, not in money, but in increasing the enjoyment of our home. Some of these projects can add some value, but the added value is not a determining factor on how much I spend.

While your home is an investment, it is also your home, and that is its true value.