According to Trulia, the kitchen is one of two “make it or break it” rooms in a home. This means that potential buyers tend to focus on the kitchen when shopping for a new home. It also means that the quality of the kitchen can have a huge impact on the price of the home.
An outdated kitchen can lower the price of your home, whereas a newly renovated kitchen can increase it. How much does a kitchen remodel increase a home’s value? Here’s what you need to know:
How Much Does A Kitchen Remodel Cost?
The cost of an updated kitchen can vary depending on a number of factors, including the extent of the remodel and design choices.
The average cost of a major remodel of a 200-square foot can range from $64,000 to $126,000 depending on the materials that are used. A major remodel will fall on the lower end of this range if it involves mid-range features such as semi-custom wood cabinets, an island, laminate counters, standard sinks, energy efficient appliances, updated flooring, and new lighting.
Major remodels will fall on the higher end of this range if they include upscale features such as granite countertops, glass tile backsplashes, custom wood cabinets, natural stone flooring, high-end sinks, and built-in appliances.
Minor remodels will not cost nearly as much as major remodels. The average cost of a minor remodel of a 200-square foot kitchen is $21,000. This price includes replacing the fronts of cabinets, installing new laminate counters and mid-priced flooring, and purchasing several new energy efficient appliances. This is not as extensive as a major remodel, which is why it is generally more affordable.
The size of a kitchen can also affect the cost. Flooring, countertops, and cabinets are priced by the square foot, so small kitchen remodels will cost less overall.
How Will A Kitchen Remodel Affect Your Home’s Value?
Multiple surveys have revealed that buyers are attracted to homes with updated kitchens. Therefore, an updated kitchen may make it easier for you to sell your home quickly and for a higher price. But, will a remodeled kitchen increase your home’s value high enough for you to recoup the money you invested in the project? Not necessarily.
The average return on investment (ROI) for a major remodel with upscale features is around 54%, so homeowners can recover about $68,000 of their initial $126,000 investment.
The average ROI for a major remodel with mid-range features is slightly higher at 59%, which means homeowners can recoup about $38,000 of their initial $64,000 investment.
The ROI is typically higher for minor remodels. A minor remodel has an average ROI of 81%, so homeowners should expect to recoup about $17,000 of the $21,000 they invested in the project.
These are national averages, so the amount you are able to recoup may vary slightly depending on your location. For example, studies show that the average ROI for a minor remodel is higher on the west coast, where homeowners can recoup about 93% of their investment. On the other hand, homeowners who live in Minnesota, Missouri, Iowa, and other mid-western states may only recoup about 68% of the money they invested in a minor kitchen remodel.
How to Remodel A Kitchen On A Budget
In general, a remodel will not increase the value of your home enough for you to make a significant return on your investment. However, this does not mean that you should give up and try to sell your home with an outdated kitchen.
It’s best to try to remodel your kitchen on a budget instead. Follow these tips:
- Don’t overdesign the kitchen. Adding too many details can raise the price of the remodel and make the kitchen look cluttered and less comfortable.
- Splurge on focal points, such as the backsplash, hardware, and fixtures in the kitchen. Buyers tend to focus on these design elements, so they can have a big impact on your home’s value.
- Stick to the same layout. The cost of a remodel will increase drastically if you plan on moving the plumbing or gas lines, so it’s best to avoid changing the layout.
- Get the look for less. Look for low-priced flooring and countertop materials that are designed to look like upscale materials.
Following these tips can help you bring your kitchen up-to-date without breaking the bank. Because you aren’t spending as much on the remodel, you may be able to make a significant return on your investment when you sell your home.
Invest in Your Dream Kitchen to Increase Your Home’s Value
Remodeling your kitchen can attract more buyers and increase your home’s value. Even if you’re not ready to sell, a remodel can help you make the most out of your kitchen until the time is right. You may not be able to recoup the cost of a six-figure upscale remodel, but it is possible to make a return on your investment if you make smart choices and spend wisely.