Here are the top cost-recouping projects by category:
Midrange Projects - Cost Recouped
Deck Addition (wood) 81.8%
Siding Replacement (vinyl) 80.7%
Minor Kitchen Remodel 79.5%
Window Replacement (wood) 77.7%
Window Replacement (vinyl) 77.2%
Major Kitchen Remodel 76.0%
Bathroom Remodel 74.6%
Upscale Projects - Cost Recouped
Siding Replacement (fiber-cement) 86.7%
Siding Replacement (vinyl) 80.4%
Window Replacement (vinyl) 79.2%
Window Replacement (wood) 76.5%
Bathroom Remodel 70.7%
Major Kitchen Remodel 70.7%
Keeping a Home Buyer's Perspective
Since the return on investment of a project is ultimately determined by how much a home buyer is willing to pay for it, it's worth keeping in mind that
more expensive projects sometimes remove mental barriers to entry-level buyers better than lower cost projects do.
For example, a midrange wood deck addition costs $10, 601 and has an 81.8% cost recouped, while a minor midrange kitchen remodel costs $21,246 and has a 79.5% cost recouped.
Even though the deck addition shows a higher return on investment,
a prospective home buyer is more likely to be daunted by the prospect of having to go through the expense and effort of remodeling a kitchen than of adding a deck. (Remodeling an outdated kitchen is also more likely to be seen as something that needs to be done right away, while a deck addition can usually be put off for a few years.)
National Trends
The average percent of cost recouped for all projects peaked at 86.7% in 2005, dropped to 70.0% by 2007 and then declined just slightly more in 2008, to 67.3%.
Compared to 2007, three projects showed an increase in the percent of cost recouped, all in the upscale category: replacing siding with foam-backed vinyl, a bathroom remodel, and adding a composite deck.
Regional Trends
Cities in the Pacific region, including Alaska and Hawaii, outperformed the rest of the country by 14.8% when it came to cost recouped on home improvement projects. (Even though construction cost in Pacific states was 17% higher than the national average, return at resale was 33% higher.)
Southern and mountain regions had returns of approximately 3% to 8% better than average.
The New England, Mid-Atlantic and East North Central states fared the worst, with returns of around 7% to 13% less than the national average.
Tips on Reading the Report One new feature of the report in the 2008 version is the ability to
compare data between 2007 and 2008 on a national, regional or city level.
For example,
click here to compare the difference in cost recouped nationally between 2007 and 2008 on all projects.
