8 home improvement projects that add the most value

Home improvement is a $400 billion industry in the United States. With so much invested in improving our homes, we hope that home really is your happy place. Recently, we’ve all become aware of what works in our homes and what doesn’t. When an area of your home isn’t working for you, you can take on a project to change that, but how can you know what home improvements add the most value?

We compiled a list of the best (and a few of the worst) home improvements that add value to your property. Don’t forget to research how your project could affect your homeowners insurance before you embark on your home renovation journey.

Jump ahead to the infographic for inspiration on making home your happy place!

Best indoor home improvements to increase ROI

Your home should be a place that you enjoy. Since we spend the majority of our time inside, our homes should be functional and pleasing to the eye. Fixr Remodeling Specialist Cristina Miguélez says “it’s the small, cosmetic updates that add the most value” over major projects. Check out some of the most valuable indoor home improvements below!

Before you get started on your project, remember to consider the risks when choosing whether to DIY or hire professionals. Gian Moore, a DIY expert at Mellow Pine, states that “home improvement projects involving gas or electricity are not to be DIY'd unless you're skilled in that kind of work.” Moore states that it can be an issue of “safety and [a] danger to everyone in your home, and [there may be] lack of insurance when a claim is necessary.” 

1. Do a minor kitchen remodel

Minor kitchen remodels have the best added value of any indoor home improvement project. On average, when U.S. homeowners go to sell, about 78% of what is spent on a minor to mid-range kitchen update is recouped in value. A good budget for something small-scale like upgrading cabinetry, painting or adding a tile backsplash is between $10,000-15,000. For a mid-range project like replacing flooring and countertops, allocate $15,000-25,000.

Pro tip: For minor kitchen remodel inspiration, check out Netflix star Bobby Berk’s advice for updating kitchen cabinetry!

2. Install energy efficient features

Having an energy-efficient household can do wonders for your comfort, your wallet and the environment. Thermal comfort, or the comfortability of the temperature inside, is closely tied to energy consumption. By refitting your home with energy efficient windows, you can save 17.4% on energy consumption, and you can save 10% on consumption using more efficient insulation. Energy efficiency adds value by regulating thermal comfort in your home, reducing your carbon footprint and saving you money on utility costs.

3. Update a bathroom

Remodeling an existing minor bathroom is another indoor improvement that retains good value. With an average 64% of the cost recouped, you can choose to update fixtures on your sink and shower, add wallpaper or redo the floor. The key is knowing you don’t have to start from scratch and that you should choose where to spend on your bathroom wisely.

Pro tip: Once you have updated your bathroom, add value to your life by organizing what’s inside like Clea and Joanna of The Home Edit.

4. Finish a bonus room

If you already have an existing bonus room, improving it for added functionality adds value and appeal. Jody E. Peters of The Riverside Realty Group says finishing the room with “neutral colors, understated light fixtures and limited built-ins make [bonus] spaces appealing to anyone and everyone.” 

Nice finishes help prospective buyers see the room’s potential for whatever they need, like a playroom, office or media space. Depending on location and market, bonus rooms can add anywhere from $10,000 to $30,000 to the value of your home.

Best outdoor home improvements to increase ROI

When undertaking home improvement projects, real estate appraisers now advise that homeowners concentrate energy and resources outside. These four home improvement projects add immense value through curb appeal and outdoor functionality.

5. Add a stone veneer

Adding a manufactured stone veneer to the outside of your home is ranked as the number one home improvement project for added value, recouping nearly 96% of investment. Manufactured stone is fake stone that is made from aggregate and cement to construct a durable, cost-effective, convenient and consistent veneer for a building. 

The value of this investment has gone up since 2019, and you don’t need to refinish the entire outside of your home to reap the reward. In fact, just replacing a portion of the front facade of your home can do just the trick to increase your curb appeal.

6. Replace your garage door

Coming in as the second best home improvement project for value, a garage door replacement regains about 95% of its cost. Spending on a quality garage door with some updated features like top panel windows adds value that can last a lifetime (seriously, many have lifetime warranties).

7. Redo siding 

Replacing siding is a common home repair that will majorly bump your curb appeal and retain value. There are many materials to replace your siding with, but the two materials for the best value for money are fiber-cement and vinyl. Fiber-cement returns nearly 78% of your investment, while vinyl returns about 75%.

Pro tip: John Weisbarth and Zach Giffin of Tiny House Nation know that exterior siding can really level up any home. Check out the sleek exterior of the #9 tiny house on this list for inspiration.

8. Attach a wooden deck

An outdoor deck is the perfect project to add value, functionality and a pleasing aesthetic to your outdoor space. Whether you like to entertain with backyard barbecues or are looking for a serene spot to relax, an attached wooden deck regains about 72% of its original cost.

Worst indoor home improvements with little ROI

Not all home improvement projects are created equal, and spending more money doesn’t always give you more bang for your buck.

Major kitchen remodel

A major kitchen remodel only keeps between 53-59% of the value of your original investment. With major kitchen projects ranging anywhere from $50,000-$150,000, it turns out spending more equals less value. When compared to the value of a minor kitchen remodel, the disparity in value recouped lands it as one of the worst home improvement projects.

Upscale master suite addition

Considering a luxury update to your master suite? It may not be the best idea if you ever plan to sell. Upscale additions to a master bedroom like an added lounge area, custom built-ins, fireplace or luxury bath features are typically done to the owner’s taste and don’t always have universal appeal. Coupled with the fact that they only get a 52% return on investment, these projects do little to add value to your home.

Worst outdoor home improvements with little ROI

Your outdoor space is important, but it’s also crucial to be realistic about the value of these two worst outdoor home improvements.

Major landscaping

Completing a major landscaping project to add value to your home might not be the most fruitful. Instead, choose low-cost landscaping! The goal for your outdoor space should be to make it look well-kept and maintained. Feel free to DIY this home improvement — try mowing your lawn, weeding and adding a pop of color with perennial flowers to make a world of a difference on a budget. 

Pro Tip: Kevin McCloud of Grand Designs says that adding plants helps sell because it shows that your home has been loved and taken care of.

Swimming pool installation

In-ground swimming pools are big investments, and they don’t always come with big rewards. Swimming pools are very costly to maintain considering cleaning, filters and electricity if you intend to heat it. A pool can increase your home insurance costs and even decrease the value of your home if it isn’t in good shape or doesn’t fit with the surrounding landscape. However, if you do live in a hot climate where pools are common in your area, a pool may be a better fit and won’t detract value from your home. 

Whatever home improvements you decide to undertake, remember that you can add a lot of value with a minor project. Take some inspiration from the pros and if you are fresh out of ideas, remember that outdoor improvements to the curb appeal of your home get the most bang for your buck. 

Always check your homeowners insurance to see that your remodel process is covered and that any new additions are protected as well. Happy renovating!