The Highest-ROI Renovations

The annual Remodeling Cost vs Value Report consistently finds that high-ROI projects are almost never the dramatic gut renovations featured on television. The highest returns come from modest exterior improvements: Garage door replacement (~103% ROI): consistently the single highest-ROI home improvement. A new garage door costs $3,000–4,500 and adds $3,100–4,600 in resale value. The visual impact on curb appeal is disproportionate to cost. Steel entry door replacement (~100% ROI): similarly high ROI for a modest cost. A new entry door costs $1,500–2,500 and returns approximately that in value. Minor kitchen remodel (~81% ROI): replacing cabinet fronts, adding new countertops, updating fixtures and appliances without moving walls or plumbing. Cost: $25,000–40,000. Return: $20,000–32,000. Deck addition (~65-80% ROI): wood decks have higher ROI than composite; composite decks last longer. Both outperform most interior renovations.

The Lowest-ROI Renovations TV Makes Look Profitable

Major kitchen remodel (38–59% ROI): gutting a kitchen, moving walls, relocating plumbing, custom cabinetry, high-end appliances. Cost: $75,000–$150,000+. Return: $40,000–80,000. This is the renovation featured most prominently on home renovation television and it consistently produces the weakest ROI of any common project. Primary suite addition (42–58% ROI): adding a master bedroom and bath. High cost ($140,000–$300,000+), modest return. Bathroom addition (52–59% ROI): similar to primary suite, the return does not keep pace with the cost in most markets. Backyard pool (30–50% ROI): highly climate-dependent. In Florida, a pool adds meaningful value. In Minnesota, it may actually reduce buyer pool (not all buyers want pool maintenance liability). Television almost never addresses this geographic variation.

Why Renovation ROI Is Never Dollar-for-Dollar

The intuitive assumption is that renovating a kitchen from outdated to modern adds the cost of the renovation to the home's value. This is consistently wrong. The reasons: 1. Appraisers value based on comparable sales, not renovation cost. If comparable renovated homes in your neighborhood sold for $450,000, your newly renovated home will also appraise near $450,000 — regardless of whether you spent $40,000 or $100,000 renovating the kitchen. 2. Buyers have a budget for the home, not for the kitchen. A buyer who can afford $450,000 might prefer a $440,000 home and spend $10,000 on their own kitchen rather than pay $450,000 for your renovation choices. 3. Taste is personal. Your $80,000 kitchen renovation in Calacatta marble might be exactly what some buyers want and exactly what others would redo.

“The renovation ROI data is consistently humbling. Every homeowner and every buyer-renovator I have worked with comes in believing their renovation will return more than it costs. The Cost vs Value Report says almost none of them will. The closest things to dollar-for-dollar returns are garage doors and entry doors. Everything else returns 50–80 cents on the dollar at best, and major gut renovations often return less than 50 cents. The renovations worth doing are: the ones that make the home livable for you while you own it, or the ones that help the home sell (cosmetic updates, fresh paint, curb appeal) rather than the ones that express your taste.”

— Ryan Brown, Principal Broker & CEO, Own Luxury Homes®

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