How much return on my investment can I expect from a remodel?

Projects with Maximum Return
Consider the current residents of your home -- not the future ones -- when you remodel.
Consider the current residents of your home -- not the future ones -- when you remodel.
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When you sell a house that's been renovated, you can expect to get somewhere between 60 and 85 percent of the renovation's cost added to the value of the house [source: Remodeling]. A lot of factors will affect the actual amount, but one of the most important factors is the specific remodeling project. Adding a wooden deck brings the best return on investment. Replacing the siding and windows on a house also adds good value, around 80 percent of the cost of the project. Minor remodels of kitchens and bathrooms can return close to 80 percent of the cost too.

Some of the less cost-efficient remodeling projects are major additions. Adding a whole room, expanding the house, building a garage, even adding a second story are expensive projects that may only recoup 60 to 65 percent of your costs.

These are very general numbers, of course. For a more detailed look, broken down by region within the U.S., you can take a look at this table compiled by Remodeling Magazine.

Some of those numbers may sound bleak, but there's a bright side. They only represent a poor investment if your sole purpose is to increase the value of your home. If you're planning a remodeling project because it's something you want for you and your family to enjoy, then look at this way: Adding a second story to your house so the kids can have their own rooms will be expensive, but when you sell the house you'll get as much as 65 percent of that cost back. That's not a bad deal.

What about all the other factors that affect the value of a remodeling project? We'll break those down next.