Choosing a good home improvement can build equity in your home as well as make your home more comfortable to live in. Equity is built by increasing the difference between the market value of your home and the money you owe on it.
Furthermore, if your main goal is to increase your home’s equity, beware of taking on loans to pay for home improvement. Home improvements do not, on average, recoup their entire cost when a property is sold.
Add the cost of borrowing money for home improvement and you might find your home improvement is helping you lose equity instead of building it.
Kitchen Remodels
Kitchens also rank high as home equity builders considered the third home improvement with best resale value. Go for inexpensive improvements that add beauty and functionality to your kitchen.
For example, dual sinks, under-cabinet lighting, marble countertops or a stylish tile/marble will give the look of a remodelled kitchen without the cost of a full-blown renovation.
An Energy-Efficient Improvement
Green home improvements such as thermal windows, insulation or a propane furnace not only help save the environment but also build your home equity. Add the grants you can apply for and the tax credits you can claim on energy-efficient home improvements and you may be looking at a profitable return on your investment.
For example, energy-efficient windows, doors or skylights. This will reduce your energy bills, increase the value of your home and make your home more comfortable by reducing drafts and sharp temperature changes.
Bathrooms
Renovating an existing bathroom in your home or adding a completely new one can increase its value and help make the home more marketable.
Smaller upgrades that can still make a big difference in the overall appearance of the bathroom include installing new light fixtures, towel racks and a double sink.
Landscaping
Ask any homebuyer what they look for in a home, and you’ll be hard-pressed to find one who doesn’t place value on appeal. After all, you can have the best interior in the world but without attractive landscaping and front exterior, few buyers (if any) will be charmed.
Even a simple, well-maintained garden can go a long way in building equity in your home. However, avoid going overboard with landscaping (i.e. expensive plants, etc) will not necessarily add value to a home.
Instead, as a homeowner try to “wow potential buyers with a well-kept compound and some well-placed shrubs or small trees.”