Remodeling magazine’s annual Cost vs. Value report is out. This much-quoted report is also much-misquoted, as various players in the real estate industry use its statistics to validate their sales pitches.
Here’s the most important thing to know about the report: use the regional breakouts to benchmark trends in your area. Don’t even bother with the national averages. They’re only of interest for tracking long-term trends. But if you are looking for guidance about how to add the most market value to your house, the regional data is the only relevant data.
In Portland Maine, for instance, you’ll actually get back 113% of the cost of a deck addition, if you use composite materials. But Portlanders are less impressed by adding a ritzy bathroom to an already-expensive house, paying only 52.7% more for the improvement than the project cost.
The report is valuable as a planning tool, too, because it outlines the commonly-held definitions of home improvement projects. If you are considering your first project, the report will show you how contractors and realty agents generally define such projects, including indicators of quality.
This is especially important if you are thinking of selling within a few years. You’ll want to choose materials, fixtures and appliances that are most appealing to buyers in your area. For instance, a higher-end kitchen remodeling project is easily signaled in a real estate listing by naming the appliance brands: Jenn-Air, Viking and Bosch are shorthand for a top-quality project.