From the bathroom to the garage, from the ceiling to floor, here are some ideas on how to upgrade your home to yield max ROI.

What’s Homeowner ROI?

In business terms, ROI means a Return on Investment – and it’s a profitability ratio that measures how well an investment performs. ROI is a simple formula, usually expressed as a percentage. It looks like:

(Gain from your Investment – Cost of your Investment) / Cost of Investment = % ROI

So, if you purchased your home for $200,000, made $75,000 worth of renovations, and sold it for $365,000, your ROI would be:

[Sale/expected sale of home ($365,000) – Cost of investment ($75,000)] ➗ Home purchase ($200,000) = 14.5% ROI (NICELY DONE!)

In other words, by making (cost-effective) improvements, you’re helping to contribute to your home’s equity when it’s time to sell.

Analysts say you’ll get an average return on investment of about 70% for most home improvement projects. Anything higher, and you recoup most of your cost and potentially raise your home’s value. Any lower, and your chief reward will be your own use and enjoyment.

The wrong approach, however—you go overboard on your remodel, buy high-end appliances you don’t need, and poorly-time your sale. You can imagine how poor decision-making, depreciation, and market factors might converge where you lose value, and even money, renovating your home. Be wise, and prioritize.

So before embarking on any home improvement endeavor, think about your ROI. Calculate ROI for any home project by subtracting the cost of the job from the expected value increase. You can look up some of the most common home renovations and their resale value in various markets, here.

See which projects are worth the effort and expense. Or, here’s a fun game: how much ROI can you generate on a set budget? (Enlist the services of a local realtor or appraiser to help you confirm these numbers if you want to brag!). You could even use our $2,000 Thank You Payments as free home renovation money—an easy, no-cost way to increase your ROI when you choose strategic home projects. Ask us how.

7 Factors Affecting Resale Value & ROI

Upgrades that move the needle on resale value will never be as simple as just slapping on a coat of paint. The smartest home upgrades are thoughtfully chosen, well-calculated, and distributed over the course of your homeownership years.

This is both so you can absorb the high costs of renovations over time and so that you can reap their benefits as you go. There’s nothing harder at sell-time than saying goodbye to a house that you just got into the best shape of its life.

Truth be told, what helps resale value most are the home improvements that make your life easier and more enjoyable while living in it. The ones that feel like the house was always meant to be that way. Because chances are if they feel right to you, they’ll be right for the next owner as well. Your home is not just an ROI number.

All that said, this guide is going to help you improve that number — with the kind of advice a qualified SellWhenever realtor would give you on a tour of your home — to ponder when making a long-term plan.

Though there are lots of ways to approach your home’s ROI, let’s look at some of the biggest upgrade categories that can increase a property’s value overall:

Modernizing

In real estate terms, modernizing means renovating a space to meet the minimum standards set by safety codes, city regulations, and the basic suite of amenities shoppers expect in a home today. This will be the level at which you’ll likely have to renovate if your home is in need of repair.

However, modernizing for homeowners can also mean adding popular features that attract young, upwardly-mobile buyers: en suite master baths, walk-in closets, open floor plans, laundry rooms, bright lighting, kitchen islands, and smart-home integrations. These sorts of improvements aren’t required to sell but can contribute greatly to maximizing ROI.

So ask yourself: how does your home compare? Review what needs to be done, and can be done, to both update and upgrade your home.

Extra Square Footage

During the 2020-21 pandemic, demand for extra space hit a premium. About 44% of real estate agents noted that the number one motivator for homebuyers moving was the desire for more room. And in new construction, contractors report new homes increased in square footage by 8% last year.

(In other words, it’s a seller’s market. Find out more in our 2022 Seller’s Guide. )

That’s pretty rad for those sitting on a lot of square footage right now. A 2,500 sq ft home will usually outprice a 1,000 sq ft home, even if the latter is newly renovated. In fact, square footage is one of the few objective factors in determining a home’s initial value.

A homeowner can add square footage to their home by finishing a basement, adding another story, building an extension, or constructing an outbuilding or mother-in-law suite on the property.

HOT TIP: Look into any city/town ordinances and permits needed before starting any construction or home remodeling project—don’t get blindsided at your inspection years down the road!

The “New” Factor

Humans naturally get excited about “new” things. We like the peace of mind it promises: less trouble, less wear ‘n tear. Where is your home showing its age? Can you repair creaky stairs? Re-seal the windows? Stay on top of these important home maintenance projects to keep your home fit and young at heart.

This “new factor” is also linked to how fresh your home is on the market. Eager homebuyers scour the marketplace listings every day. And once a new property becomes available, it’ll get immediate attention if it’s competitively priced.

HOT TIP: Properties with unique and uncommon features will be enticing to potential homebuyers—so let this work in your favor.

Current versus Classical Design

Decorating your home with hip interior design choices can also help draw in buyers, particularly in certain markets. However, trends and ROI don’t always mix. Everyone’s tastes are different. If it’s a more permanent installation, err on the side of current, but still-classic looks to maximize your return.

Example: upgrade your home’s flooring by uncovering and/or refinishing its hardwood floors to add value. This is an enduring yet still trend-forward flooring choice that can be dressed up differently over the years with colored stains, statement rugs, etc. Also, remove dated paint colors and wallpaper (anything over a decade old is due!). And, if you’re within a year of selling, choose soft, light, neutral colors for the walls. Heaps of realtor surveys show shoppers strongly prefer homes they can easily imagine themselves in. This means, the blanker the slate, the better (so yeah, basically white). It seems us humans love dreaming big—just not against a blue chevron wall. Go figure.

HOT TIP: If you want to understand your local market better, look at home listings in your local market. Study popular home designs from the photos found on listings in your area.

Curb Appeal

Homes that can be appreciated, quite literally, from the curb are said to have curb appeal. And the rumors are true: Shoppers play favorites. They like homes with neat and attractive exteriors. Paint, trim, shutters, and ornamentals are all front-facing, exterior improvements that continually yield the highest rate of return for recouping their costs. Replacing the front door, adding landscaping, and installing driveways, walkways, and porches are all great examples.

Take the “curb appeal” of replacing your garage door, for instance, which recouped a whopping 94% of its cost to sellers at their home’s resale. Exterior facades like a faux stone veneer came in a close second at 92.1% ROI. Home upgrades that pay for themselves? It’s hard not to take a second look.

HOT TIP: A cost-effective, trend-forward alternative to replacing your front door is re-painting it. Go for a sharp-looking, bold or complementary color to the rest of your house to stay on-trend.

Structural Upgrades

Sadly, you’ll receive no return on investment if your home is riddled with structural problems. You know, the big stuff: roofing, plumbing, wiring, termite damage, foundation issues, etc. Structural problems can be an expensive fix. But the real profit killers are those unexpected, last-minute, high-cost repairs found during the inspection, when you thought your house was all but sold.

Get ahead of it. Stay on top of repairs over the course of your homeownership—and if it’s been years since your home’s last been looked at, hire a professional to take a look. Don’t get caught off guard during the buyer’s inspection, when you thought you were halfway home on a sale.

Neighborhood Popularity

Your home’s exterior isn’t the only thing being judged by its cover: where you live, and its surrounding area holds a lot of sway, too. Your neighborhood’s popularity can hugely boost resale value, as can its proximity to amenities such as parks, restaurants, and gyms. Location is, as they say, everything.

So consider how popular your neighborhood is. Is it safe? Are there schools nearby? How close are you to walkable sushi? Of course, these factors are largely outside your control, but keeping tabs is useful for maximizing the timing of your sale and therefore ROI. Track the average listing prices of homes selling in your neighborhood. Are there changes afoot? Understand how fluctuations in your city, town, and community can have ripple effects on your ROI.

Room by Room Upgrades for Max ROI

Strike a balance between wise investments and personal touches that will make your home yours. Always let personal tastes prevail—while letting our guiding ROI principles steer your course:

Kitchen Upgrades (Adobe Stock #312153032)

Kitchen Upgrades

Kitchen upgrades may not cost as much as you think. A 2021 analysis from Zonda Media found that minor kitchen remodels recovered far more of their cost, at 72.2%, over major kitchen renovations that only returned a comparative 57.4% of their value. It’s not about how much you spend but how smartly you spend it.

HOT TIP: In other words, before gutting your entire kitchen, look for more cosmetic solutions (such as refinishing, instead of replacing).

Refinish Surfaces

There are endless ways of refinishing your counters, whether tile, concrete slab, faux marble, ‘n more. And refinishing your cabinet’s surfaces, over replacing them entirely, is another such cosmetic money saver. You’d be surprised at the difference a new cabinet color or finish can make. Swap out the old handles and throw up an easy-up back

The kitchen is the heart of the home. It’s where everyone gathers to make memories and delicious food. So, a highly-functional kitchen is hugely important to certain, if not most buyers. If done right, your kitchen is one of those rooms with the most potential for ROI.

There are endless ways of refinishing your counters, whether tile, concrete slab, faux marble, ‘n more. And refinishing your cabinet’s surfaces, over replacing them entirely, is another such cosmetic money saver. You’d be surprised at the difference a new cabinet color or finish can make. Swap out the old handles and throw up an easy-up backsplash, and you won’t recognize your kitchen!

HOT TIP: Stone countertops tend to keep their condition, and resale value, longest.

Upgrade Appliances

New appliances are a trademark of a modern, upgraded kitchen. Safe to say if your appliances are more than a decade old, or your stove has to be lit with a match, you’re in need of an upgrade.

Matching appliances present a cohesive aesthetic that looks more put together. Stainless steel appliances tend to be more coveted, though matte black has become a trend, too.

Don’t assume you have to spend thousands on new appliances, however. Make selections based on what comes standard in the homes of your area and listing range (interior photos on Trulia/Zillow are great ways to snoop on that). Buy with your own preferences in mind if you’ll be using them yourself.

HOT TIP: DON’T purchase high-end appliances just to sell your property. Some buyers (especially those who already have high-end appliances) prefer to bring their own — so it might be a waste. Low to mid-range appliances from a reputable brand are sufficient if you're only buying units to sell.

Bathroom Upgrades

What value do you place on bathrooms? While some shoppers could care less, others dream of a spa-like oasis ripped from the pages of a luxury magazine. Regardless, yours will need to be functional, clean, and modernized before you try and sell. Consider how even the smallest changes can increase your home’s ROI:

Tile the Floors

Serving both style and function, tile flooring is a standard bathroom upgrade these days—just don't go crazy with an wild pattern. Your tastes likely won't resonate with your future buyer.

A simple, timeless tile – like a solid or patterned white, black, or grey – works best. Or, if you desire more personality — and who doesn’t want a bathroom with just a little personality? — simply pair fun towels, shower curtains, bath mats or even, yes, fun paint colors. Because repainting is a lot simpler than retiling.

HOT TIP: If you’ve done a lot of “personalization” with “fun” paint colors over the years, fear not. Repaint with any soft neutral or white at sell time. Or, are you moving into a home with an “interesting” pattern-tiled bathroom on the buyer’s end and can’t afford renovations yet? Same advice in reverse: use neutral towels and bland paint to tame the room.

Shower vs Tub

Shower, or tub? These days, why not both?! A survey by NAHB revealed that 77% of homebuyers ranked having a shower stall and a tub as essential. Therefore, to appeal to the majority of homebuyers, a shower/tub combo is recommended. Or, if space allows, add a smaller-footprint standalone shower with a tub alongside or nearby.

HOT TIP: A bathroom requires a bathtub for appraisers to value it as a full bath.

Living Room Upgrades

Your “living” room can be so many things: social parlor, media room, play space, cuddle nest and cozy, personal sanctuary. So how does all this "living" translate into ROI?

Living Room Upgrades (Adobe Stock #161983745)

Open It Up

Homebuyers today aren’t looking for boxed-in rooms and blocked views. They want a layout with flow.

Cut-out, “Pony,” or dividing walls were an architectural feature trendy in generations past but knocking down the right ones can do wonders for connecting your living spaces. Bonus: open floor plans feel more expansive and therefore give the impression of more square footage.

HOT TIP: Consult a contractor before embarking on any demolition projects to ensure any wall or structure you want out is not load-bearing (and therefore structurally unsafe to remove).

Look to the Ceiling

Does your living room ceiling have a popcorn texture? What color is it? If you answered anything other than “no” and “white”, upgrade it.

Ensure the ceiling color is a true white to brighten and draw the eye upward. Other colors, even other neutrals, can create a closed-in feeling.

Another oft underutilized tool: lighting. A new ceiling fixture is a truly dramatic way to improve the aesthetics of a room while simultaneously infusing your living space with bright, warm, ample light.

HOT TIP: Simple, geometric light fixtures are hot right now as well as classic, timeless styles.

Garage Upgrades

Many people look at a garage and see storage and a place to park. Others envision a workspace, a home gym, or where above which they might build an addition. What raw potential does your garage have? Upgrade your home for max ROI with these basic garage improvements:

Garage Door

As mentioned in curb appeal (above), new garage doors are, perhaps surprisingly, one of the most surefire ways to see returns on what you spend. Your garage is like another front door of your home. So making changes here can dramatically improve your home’s exterior appeal, which in turn, attracts eager buyers. Replace yours with a high-quality garage door in a color that matches or compliments the rest of your home. Note that automation is now considered standard.

Insulate the Garage

Attached garages are not temperature controlled, so if you live in an environment with extreme heat or cold, it makes sense to insulate the garage.

Proper ceiling and wall insulation will protect your car and storage items from the weather, and you can add weather stripping to minimize drafts as well. You’ll thank yourself later for this home upgrade when you step into the garage on a cold morning, and it’s not freezing.

“If your home has an unfinished basement, consider it an ROI goldmine.” -SellWhenever

Basement Upgrades

Post-pandemic, more and more homebuyers are looking for extra space. A finished basement is a huge draw. If you have an unfinished basement, consider it an ROI goldmine.

Not only can you increase your overall ROI by increasing your home’s total square footage by finishing a basement, but the potential uses are near limitless. Imagine anything from a home theatre to a kid's romper room, to a second, income-generating rental space. In other words, leave your basement in better condition than you bought it, to max out your ROI.

There are plenty of ways crafty DIY homeowners can improve a basement that still leaves an appealing blank canvas for future buyers. Consider a second, coveted living room, den, or workshop, adding a half-bath, putting up sheetrock, painting concrete floors, installing additional lighting, or adding wall-to-wall carpeting. AIm to leave the basement floorplan open, with no walls, to maximize usable space for the next buyer.

Design a Second Living Space

With the same square footage as your primary floors, imagine how a second living space, or even a separate rental apartment, might add value to your home. Adding a full bath, a half-kitchen, and a separate entrance can make it so.

Soundproof It

A soundproof basement is more useful than it sounds (pun intended!). Suppose you enjoy practicing or listening to music, entertaining lots of children, hosting a boisterous game night, or simply seek some subterranean peace and quiet every now and again. In that case, a soundproof basement is a valuable solution.

Install professional soundproofing on the walls and the ceiling, or use foam padding for a DIY solution, and carpeting can help absorb sound, too.

HOT TIP: Note that while carpet can be effective for soundproofing a room, hard flooring is a more versatile option for resale. Floor rugs are a great happy medium!

Bonus Room Upgrades

Got awkward, unusable space in your home just laying in waste? Consider throwing up a wall or two, and a door, to transform it into a media room, yoga studio, home office, playroom, or small extra guest bedroom. These ideas can help maximize your square footage, without the major construction of putting an addition on your home.

Upgrading your home for max ROI is important, but don’t forget to enjoy the space in a way that’s best for you.

Other Renovations to Increase Your Home's Resale Value

We’ve traveled room by room to point out home improvements that increase value. Now, let’s put a magnifying glass on commonly overlooked selling points that when refreshed, can lead to a maximum return on your home investment.

Flooring

Adding tile, hardwood, or natural stone adds value to a home’s flooring (vinyl, linoleum, concrete, not so much). However, installing anything with a bold pattern on the floor (never go floral!) will deter the average buyer. Installed wall-to-wall carpeting also tends to evoke disdain, as carpeting has a way of trapping odors, pet dander, and stains. Consider the fact you may one day need to replace or remove them before listing your home.

To maintain value, go with a traditional white tile or dark hardwood floor. You can always buy a rug in the pattern or color your heart desires.

Paint

Believe it or not, paint color is another factor affecting a homebuyer’s opinion of your home. But this one’s an easy one to swap out when it’s time to sell.

Bold and funky paint colors are perfect for the years you live in your home. But when potential buyers come knocking, many will be turned off when they don’t like the same color as you. If you've done a lot of “personalization” over the years, repainting is an easy, and important upgrade. Use soft, neutral-colored paint: white, gray, or subtle warm tones to help future home buyers visualize your home as their dream.

Landscaping

The first impression your home makes is with its front-facing yard. It is what evokes a feeling before anyone steps inside. So when it comes to resale value, landscaping is all about curb appeal.

The best thing is to care for your property’s trees, yard, and outdoor spaces throughout your ownership years, so when it’s time to sell, everything’s in tip-top shape. This is much easier if you avoid overly intricate landscaping or gardens that require a lot of maintenance. For the sake of upkeep (and your own sanity) keep your outdoor space simple, elegant, cost-effective, and easy to change.

A home with curb appeal. (Adobe Stock #232729949)

The best landscaping bang for your buck? Simple lawn care (cutting, fertilizing, watering, and weeding) is fairly easy to DIY, but makes a huge impact. Or if you’re selling soon, consider hiring a landscaping crew to come in and do a fast, professional job of it. Just make sure to set a budget and prioritize the services that will yield the best results.

HOT TIP: Trimming, edging, and mulching offer high-impact visual appeal, for relatively low overhead.

Trees

What’s something you can invest in today that will continually grow in value for years to come? Trees.

Never underestimate the value of a tree. Properties are known to have been bought and sold for their trees alone. And for many homebuyers, a yard with trees will trump many other features inside or outside the home. Consider trees an essential part of a home’s landscaping.

But do your research first. What sort of trees flourish in your area, and which are to be avoided for their flowery mess? How tall will each species get? Which will need special care and maintenance?

Should you have trees already, carefully maintain them so they remain healthy, strong, and structurally sound. Think hard about any trees you decide to have removed from your property, and why. A professional arborist or landscaper can help you make those decisions.

HOT TIP: Stay away from messy pines and stinky female Ginkgo Biloba. Crepe Myrtles or Blue Spruce make great landscaping options.

What To Do Before Starting Home Renovations

If you find the idea of home renovations nerve-wracking, you’re not alone. There’s much that can go off track. Nightmarish stories seem all too common.

Rest assured, though, most projects do go mostly to plan, as long as clear expectations are set, budgets are agreed to, and schedules remain flexible. Another important key to success? Checking expectations at the door.

Yep, it’s hard to know where to begin when embarking on a large or ambitious home project. But with a starting point and some direction, we hope to ease your mind. Here’s a guide:

Make a Plan

Look ahead. Think about when you hope to one day sell. Then create a one-year, two-year, or five-year plan mapping out your renovation goals in sequence.

Don’t let your list overwhelm you. Complete these projects as your time and savings allow. Making a big-picture plan can help each completed project feel like a step toward a larger and more lucrative goal.

In every case, if you think about the upgrades you make that can boost resale value in the future, you’ll be in great shape when “one day” comes.

Consider Your Budget

Set up a flexible, reasonable budget for your home upgrade projects. Ok ready? Now double it. You heard right. No matter how much you think a home renovation project will cost, it’ll end up being more.

A few extra forgotten materials, a broken tool, a few surprise supply-chain problems later, and suddenly, you’re 20% over budget and only halfway done. But once you start stripping wallpaper and ripping up floors, it’s hard to turn back. Surprises always find you. Double your budget and you’ll never regret it.

Map Out a Design Plan

Next, you’ll need to map out a design plan. Granted, you’re no architect. But, quite literally, draw it out. You should have a clear vision of what you want when the space is finished, long before anyone picks up a hammer. Start collecting your ideas on a vision board with color swatches, paint chips, clippings from magazines (got a power word you want to channel? here’s where you put it) or digitally on Pinterest board or Canva collage. Give yourself or your contractor a clear vision of what you want before you start.

Hire Out—or, DIY It?

Some projects are perfectly reasonable to tackle yourself, while others are not. Anything that requires electrical, specialty plumbing, putting on a new roof, etc. are all jobs best left to the professionals. Because guess what’s bad for ROI? Having to hire a professional to re-do your “handiwork.”

If you know what you’re doing, though, all the better for ROI: tear out that carpet, repaint that room! Just be sure to do some cost analysis to make sure these tasks are not better hired out. Your time is also money, after all. And when reaping the most out of your initial investment is the goal, strategic upgrades are key.

Conclusion

Ultimately, the amount that your home appreciates over time is up to lots of factors beyond your control—location, original build date, the health of the structure within. But how you renovate, remodel, or improve your home has everything to do with you. Whether you pick subway tile or stone countertops. Whether you forgo remodeling your master bath to replace your overdue roof. As a homeowner, these are choices you make, and you alone. You decide how best to spend for, invest, and enjoy your largest financial asset: your home.

Sarah A. Lybrand

How to Upgrade Your Home for Max ROI