10 home improvements with the best return for sellers

Key tips to remember

  • Your expertise can inform sellers about smart home improvements before their home is listed.
  • Exterior home improvements provide the biggest return on investment.
  • Minor tweaks to kitchens and bathrooms get a better return than a major remodel.
  • Landscaping and adding a deck are the lowest-cost ways to make outdoor space more attractive.
Real Estate Marketing, Real Estate

Finding the sweet spot between spending on home improvements and earning the biggest return on that investment is a delicate balance for home sellers. While overhauling the kitchen may seem necessary in a dated home, studies show that spending $50,000 or more will not generate an offer that’s $50,000 higher.

While every listing has unique characteristics that will drive your recommendations for where to spend limited home improvement dollars before a sale, Remodeling Magazine’s annual Cost vs. Value Report provides a general guide to which projects are most likely to recoup their investment.

Outdoor projects with the best return on investment

Real estate agents know that curb appeal is vital to getting buyers’ attention and immediately influences their feeling about a property. That may be why the projects with the best return on investment in the Cost vs. Value Report typically include the following:

  1. Manufactured stone veneer. Upgrading siding with this project earns the greatest ROI on the 2020 report.
  2. Garage door. Replacing the garage door is a relatively simple project that is also high on the list of valuable home improvements.
  3. Front door. Replacing or painting the front door provides an immediate facelift to a home. Also, updating the entry with potted plants, a seat or a trellis can make it much more inviting with a relatively small investment.
  4. Landscaping. Outdoor living areas are a top priority for most buyers, so enhancing that space with a yard cleanup and a few plants can make a big difference in their enthusiasm.
  5. Deck. Increasing usable living space outside with a deck may be smart, but beware of your sellers spending too much on a bigger project that may not recoup the cost at the closing table. Have them do their research first.

Indoor projects with the biggest bang for the buck

Your staging expertise can go a long way to increase the attractiveness of the inside of your sellers’ homes. Decluttering is a free project your sellers can probably handle without professional help. But some interior home-improvement projects can add to a home's value — particularly if you're tracking comparable homes in the neighborhood to avoid overspending. While the 2020 Cost vs. Value Report says that a mid-range kitchen remodel at an average cost of $68,490 would only recoup 59% of its investment, some less pricey and more practical indoor projects include the following:

  1. Paint. Fresh paint and an updated color scheme provide an instant lift that can be particularly inexpensive if the homeowners do it themselves.
  2. Lighting. New light fixtures — available in a variety of prices — can make an older home look fresher.
  3. Re-facing or painting kitchen cabinets. A quick fix for a dated kitchen is to paint or replace the cabinet doors.
  4. Minor kitchen remodel. Cosmetic changes, such as replacing appliances and counters without changing the kitchen configuration, can cost less than $25,000 and may increase the size of the offers for the home.
  5. Minor bathroom remodel. A complete bathroom overhaul can be expensive and unlikely to recoup the cost. Still, if your sellers can keep costs under $10,000 and replace the tub and tile surround, update the vanity top and redo the floors, they're likely to get their investment back with a higher sale price.

The information in this article is intended to provide guidance on the proper maintenance and care of systems and appliances in the home. Not all of the topics mentioned are covered by our home warranty or maintenance plans. Please review your home warranty contract carefully to understand your coverage.