For millions of Americans, owning a home is the biggest purchase of their lives. To protect that purchase, it’s important to consider return on investment (ROI) as a key factor in the home improvement decision-making process. As the Phoenix real estate market continues to improve and stabilize, more and more Valley residents are faced with the decision to cash in their home’s equity or their hard-earned savings to make improvements to their homes.
At Arizona Financial, we’re interested in providing you with the expertise needed to get the most ROI when it comes time to remodel or sell your home. We recently sat down with Rosie Romero, local Phoenix home-improvement expert and host of the Saturday morning radio show "Rosie on the House" (92.3 FM KTAR), to get his perspective.
Rosie has been on the air for more than 26 years, and considers it both an honor and responsibility to be recognized as one of Arizona’s most trusted sources of home-improvement advice and know-how.
In this blog, you’ll find ideas for home improvements no matter what your budget may be. We’ll talk about kitchen, bathroom and outdoor upgrades that will not only bring you excellent ROI, but will also allow you to enjoy your home for years to come.
Ready to upgrade your living space? A home equity line of credit can give you access to the
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Upgrading your kitchen
With this relatively modest budget you can take cabinets that may be showing signs of wear and make them look new again. You’ll first need to determine if your cabinets are worth reviving. Are the cabinets sturdy and still functioning properly? Do you like the overall design, particularly the door cabinet faces? For $2,000 you can remove the doors and bring them to a professional to color match the wood and repaint them, sealing them with a varnish and really allowing the color to pop in your kitchen. Another idea in the same budget range would be to add dramatic under cabinet lighting. Additional lighting can make it easier to work in the kitchen when preparing meals while also highlighting your countertops. Rosie says that when it comes to the kitchen, you can never have too much light.
If you have a little more to spend on your project, you can make even more changes. You could start by installing new countertops throughout. According to Rosie, maple butcher block is a countertop material that often gets ignored but can add warmth to your kitchen. It’s hygienic, easy to maintain and if it gets a scratch or a stain, all you have to do is lightly sand it to bring it back to its original beauty. At $7,500 you may also start to think about upgrading your existing appliances. Putting in a nice mid-grade steam sanitizing dishwasher is a great way to add value to your kitchen remodel. Some other popular upgrades in this price range include adding recessed lighting in place of acrylic-lensed fluorescent lights and removing soffits to raise the ceiling. Raising a ceiling can be an inexpensive way to make a room feel much bigger without actually adding square footage.
If you have about $15,000 to spend, you can really make a lot of changes to your kitchen to make it feel virtually brand new. Rosie suggests refinishing, resurfacing and re-facing all cabinets; upgrading all of your appliances; and installing new countertops. Keep in mind that a typical kitchen remodel will cost anywhere from $500 to $600 per square foot.
If you have a “dream budget” of $50,000 or more, you can afford to pick brand new cabinets, countertops, all new appliances and new flooring. Add under cabinet lighting to really make your new kitchen stand out. A good rule of thumb to remember is that your total renovation budget can be calculated by taking the cost of your new cabinets and multiplying it by four. But something else to remember is that a full kitchen remodel can increase your home’s value by almost 25 percent.
The second area that many homeowners are interested in upgrading is the bathroom. Rosie says you cannot discuss a bathroom remodel without a little bit of “potty talk.” The number one upgrade that is being done to bathrooms in the Valley according to Rosie is the so-called hands-free toilet. These can run from $2,000 to $3,000 including installation. The toilet essentially allows users to handle their business, clean, dry and flush without the use of toilet paper or touching the handle to flush. You can use your imagination, but these are extremely popular upgrades.
While upgrading to a high-tech toilet may sound like fun, it may not produce the best return on investment if you have a limited budget and are looking to prepare your home for sale. According to Rosie, installing an acrylic liner is a low-cost way to revive your aging tub/shower. Although not cosmetic in nature, he also suggests adding a vinyl pan below the bathroom sink. It could be a real lifesaver by catching drips from leaky pipes you may not notice until the damage has been done. Other frugal but impactful do-it-yourself bathroom improvements include new towel bars, lighting fixtures, cabinet hardware, and a colorful shower curtain and towels. Plus, you can never underestimate the impact of a fresh coat of paint in the bathroom – or any room for that matter.
For $7,500 you can easily afford a new cabinet/vanity base and a high-end countertop like granite or quartz. With that, you can also upgrade your faucet and sink to something deeper than what is installed in most homes. Use a portion of the budget to put in some recessed lighting and a frameless shower enclosure. These types of upgrades will make your home much more attractive to potential buyers when the time comes to sell.
Removing your old, moldy shower and installing a custom one with modest finishes is a great way to renovate your existing bathroom. Add more lighting to improve functionality and make the space more inviting. With $15,000 you can afford these upgrades to be done right by hiring a professional contractor. It will give you peace of mind knowing the job has been done correctly. Keep in mind that bathrooms are the most expensive rooms to remodel. Costs will be anywhere from $600 to $800 per square foot.
If you really want to do an over-the-top bathroom upgrade, you can easily spend $60,000 or more. This type of remodel would be considered a full gut-job. As Rosie would say, “You’re bringing it down to the studs.” With such an extensive remodel you could change everything – flooring, walls, sinks, toilet, tub, shower, vanity and countertop – essentially rebuilding the bathroom from the floor up. You could also take advantage of this clean slate to run entertainment cabling and install new outlets or move existing ones. Some very popular bathroom upgrades for folks who can afford it are TVs and surround sound. Add the aforementioned hands-free toilet and this bathroom sounds like a very pleasant space to enjoy.
Budget: Around $2,000
The two most common upgrade requests to homes in the Valley are kitchens and bathrooms, but another way to add value to your investment is by paying some attention to the outside. Getting rid of concrete porches or other concrete on your property by replacing it with pavers can be an inexpensive and easy way to increase value and curb appeal. “There are two types [of concrete]: cracked or going to crack,” says Rosie. You can easily replace stained or damaged pavers, but repairing concrete is a bit more difficult.
Completely replacing the concrete is the best option, but if you are on a tighter budget or your concrete patio is part of your foundation, you can also look into overlay pavers. These are thinner than traditional pavers because they go over existing concrete, and they go a long way toward beautifying your property.
Another attractive and cost-effective upgrade is an outdoor entertainment system. Speakers that look like rocks can be easily placed in desert landscaping. When the sound is pointed at your entertainment area, the music can add a wonderful ambiance to your outdoor social gatherings all year round.
Adding a built-in barbecue grill gives your backyard a custom look and feel. If your home allows for it, hooking into the gas line is a sure-fire way to make sure you don’t run out of gas. But these grills can cost you! Expect to pay $2,500 or more depending on how many bells and whistles you’re looking for in a grill. Lighting features and some modest stone work will round out your project and provide a significant return on investment.
Provided you have the budget to support it, installing a small water feature can be more efficient (from a water usage standpoint) than planting grass or desert landscaping. Rosie suggests looking for an expert in building small, sustainable ponds that use less water than any lawn and add interest to your property.
A drop-in fire pit with gas line can also really add value to your property by creating a cozy spot to enjoy on a chilly desert night. The pond and the fire pit will easily cost $15,000 or more if done right, but the value added can be recouped upon sale of your home.
Upgrading your home can give it character and, if it’s done right, more appeal, both inside and outside the home. When investing more money in your home, stop and ask yourself if it will provide you with the best return on investment. If not, it may be time to reconsider the expense.
And if you’re looking to update or upgrade your home without bringing your savings account down to the studs, consider letting your home do the work with a home equity loan.
Share your favorite home remodel projects with us below!