Written by: Rosa Jordan
Contributor: Zain from Smart Media Management
Source: Sarah Turner, one of Jennifer Gilmer’s top designers, remodeled this beach house kitchen in Bethany Beach. Photography by Keiana Photography.
If you have ever looked into the idea of a significant home redesign or renovation, you have likely come across the idea that updating your kitchen might increase the value of your home. It’s a notion that’s commonly mentioned on property-related blogs and websites, and it might not surprise you that it is indeed correct! Kitchen redesigns and remodels have long proven to be strategic and worthwhile investments for homeowners. Nevertheless, those considering a project like this should still consider all of the details before getting started.
First and foremost, this means considering what it actually means to “increase the value of your home” in the context of your own investment. Any minor, permanent upgrade to your home can increase the home’s value at least marginally. However, this really needs to be thought of as a matter of ROI (return on investment). The simple question to ask is whether or not your redesign or remodeling project will increase the market value of your home by more than the project costs you in the first place. If it will — as is the case with most kitchen renovations — then you’re looking at a positive ROI, and thus a worthwhile project!
Can a Kitchen Redesign Lead to Positive ROI?
In a word, YES!
The kitchen has been characterized as one of the two rooms that really sell homes (along with the master bedroom). This means that the kitchen is one of the main points of interest regarding valuation. It’s what prospective buyers will be most keen to inspect.
In very general terms, think of it this way: In an otherwise spectacular home, a bland spare bedroom, or one that seems outdated or in disrepair, won’t necessarily be a deal-breaker. In the same sort of home though, the same issues in a kitchen can lead a buyer to move on to the next listing. On the other hand, an average home with a spectacular kitchen will undoubtedly have greater resale value than it would otherwise have!
Why is the Kitchen So Important?
One reason is that the kitchen is simply a prominent, important room. A so-so spare bedroom can be overlooked because it’s spare. By contrast, the kitchen is in use each and every day. It simply needs to be a high-quality room in order to serve the homeowner well during all that time.
Additionally, though, an updated kitchen that appears to be new or recently redesigned can reassure a home buyer from a financial perspective. It’s widely recognized that a kitchen can be an expensive room. But many buyers would just as soon pay a little more for a home with an updated kitchen than purchase a home in which they’ll have to manage costs and repairs on their own in the near future.
Finally, kitchens are also relatively fixed as compared to other rooms. That is to say, a kitchen’s quality tends to be determined by its surfaces, appliances, and general design — not by décor, furniture, and other impermanent fixtures. As such, a kitchen is harder to change than most rooms, which makes a tastefully redesigned one appealing to many buyers. They can enjoy the sense that this particular job has been done for them, and the kitchen won’t require work — at least for a long while.
So — Is Positive ROI Automatic?
Source: Photos from the project described below.
Take this example: One of our clients from a few years ago directly attributed their increased selling price to their remodel. The client wrote:
“Jennifer is amazing at designing to your current needs while giving you a timeless look so it was a no-brainer that we rely on her again to partner with our architect in Deep Creek in order to design the kitchen and master bathroom space in our new family home. Under Jennifer’s guidance, these rooms turned out to be showstoppers. This time we decided to invest in higher quality products which she recommended that fit the lake environment beautifully and more importantly stayed current. That’s the reason we sold our home without listing it when a surprise buyer appeared and made us an offer we simply couldn’t refuse. Can you imagine not having to do one thing to update your home after 18 years of wonderful family memories and get an offer of greater value than you expected? Ask Jennifer for help and it could happen to you too.”
That should give you some idea of the positive ROI you can expect from a tasteful remodeling project! That said, the nature of the project also matters. As is explained in one take on home renovations and sale prices, rooms like kitchens and bathrooms should only be updated as needed. This article reveals that an “upscale major kitchen remodel” has an average ROI of less than 60%, while a “mid-range minor redo” can return 80%. This may seem counterintuitive at first, but it’s ultimately a simple matter of up-front cost. A kitchen is an expensive place to remodel completely, which makes even a generous boost in home value less likely to make a significant net return. Smaller, more targeted changes are more likely to result in a significant ROI — though as even these numbers show, a more major effort does still have a positive effect!
How Should You Organize Your Redesign?
If you’re interested in taking on this kind of project on your own and you want to maximize your ROI, there are a few simple steps to take. The first is to consider what tends to be budgeted for these redesigns. Overall, the median cost of remodeling a kitchen is right at around $65,000. Keep in mind though that this being the median means plenty of projects come in closer to $40,000-$50,000, while others easily exceed $70,000-$80,00 (with the occasional job topping $100,000!). Most of these numbers assume a larger kitchen remodel, but they still give you an idea of what many homeowners wind up spending on a full-fledged redesign. (Of course, this does not mean you have to target this kind of expense — but it helps to be aware.)
Your goal once you figure out what the median cost for a project like yours should be to figure out how you might accomplish the most with the smallest portion of that budget. Consider first the most expensive parts of a kitchen remodel — typically, new cabinets, new countertops, and particularly pricey appliances. Assess these parts of your kitchen, and determine whether or not they’re necessary to the redesign you have planned.
Once you’ve looked into your budget in this manner, you can begin to envision your project and — crucially — determine your wants and needs. Do you need those expensive upgrades for the redesign to be effective? Are there some less expensive upgrades that you want, and which could improve the kitchen in meaningful ways? These are important questions to ask because they’ll ultimately have a great deal of bearing on your budget, costs, and ROI.
Increased Home Value
While there is a lot to consider, the end result is typical that a well-executed kitchen redesign does meaningfully increase a property’s value. Indeed, as is backed up by the numbers given above and by actual testimonials, your investment can double in the end. In other words, it’s an expensive and meticulous process, but one that most homeowners find to be worthwhile from a financial perspective.
