Home improvement is one of those big-ticket items like a car or a wedding that people tend to put on their credit cards and then struggle to pay off. But it’s also a popular way for homeowners to improve their living space or increase resale value.
Some improvements, such as installing a new kitchen or basement, are likely to get the biggest return when it comes time to sell. But others may not live up to the cost or boost resale values much at all.
While there are many reasons to renovate, it’s important not to go overboard. If you spend money on a high-end kitchen or bathroom that will only appeal to a small segment of the population, it might not be worth it when it’s time to sell. Also, don’t go into debt to finance a renovation unless you have the cash saved up to cover it. This can be costly both now and in the long run as you pay interest on the debt you accrue.
According to the 2022 Houzz and Home Study, homeowners ages 55 and older are leading the way with home renovation spending. Other categories that are surging include deck construction, hiring landscapers and putting up fences. This is partially due to a pandemic that has many homeowners spending more time at home.
Whatever you do, be sure to talk to a real estate agent about your plans and budget before starting any work. And don’t forget to update your home insurance policy as the value of your house rises.