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Think about it for a second—that outdated kitchen with the chipped laminate countertops, the bathroom that hasn't been touched since the '90s, or the leaky roof you've been putting off for two years. These aren't just eyesores. They're opportunities. When you're staring at a renovation project, the dollar signs can feel overwhelming. I get it. In my work developing consumer-forward mortgage content and equity loan calculators, I talk with colleagues daily about families wrestling with these exact decisions.
Here's what this means for you: if you're a homeowner with equity in your property, you have options that go beyond draining your savings account or maxing out credit cards. A home equity line of credit (HELOC) could be the financing solution that makes sense for your situation. Unlike a traditional home equity loan that hands you a lump sum upfront, a HELOC functions more like a credit card secured by your home's value. You get a draw period-typically five to 10 years-where you can access funds as you need them.
But let's talk about the elephant in the room. Just because you can finance a renovation doesn't mean every project makes financial sense. That's where return on investment-ROI-becomes your best friend. Understanding which renovations add genuine value to your home versus which ones drain your wallet helps you make smarter decisions about where to invest your hard-earned money and home equity.
Let me be straight with you-renovations are expensive, disruptive, and sometimes downright exhausting. If you work from home like so many people do now (23% of the U.S. workforce worked from home in late 2025, according to recent statistics), having contractors traipsing through your house for weeks or months tests your patience. Depending on the scope of work, you might need to relocate your family temporarily. Even after the dust settles literally and figuratively, it takes time to reclaim that sense of normalcy.
I'm not trying to discourage you from renovating. What I am trying to do is help you think through these decisions with clear eyes. Because here's the thing: whether a renovation adds value to your home when you eventually sell and whether it's worth it to you right now are two completely different questions.
Before you pick up that sledgehammer or call a contractor, consider these two factors for each potential renovation:
First, weigh the total cost against the quality of life improvement it brings while you're still living there. That dream bathroom with the rainfall showerhead and heated floors? If it transforms your morning routine from dreary to delightful every single day for the next 10 years, maybe the ROI percentage matters less than the joy it brings. Think of it like this-you're not just buying a renovation, you're buying thousands of improved experiences.
Second, evaluate the renovation's worth in terms of resale value added to your home. This is where those ROI numbers come in handy. They give you a reality check about what you're likely to recoup when you eventually sell. If you're planning to move within two years, those numbers matter a lot more than if you're settling in for the long haul.
The truth is, deciding whether a renovation is worth the cost and disruption is deeply personal. There's absolutely nothing wrong with renovating simply because you want it, need it, or because it genuinely improves your family's daily life. The ROI framework I'm sharing here isn't meant to talk you out of your dreams. It's meant to give you clear, data-backed information so you can prioritize projects, understand trade-offs, and make choices that align with both your present happiness and your future financial goals.
Return on investment for home renovations measures how much of your renovation cost you'll recoup when you sell your home. The calculation itself is straightforward: take the value added to your home, divide it by the total cost of the renovation, and multiply by 100 to get a percentage. If you spend $10,000 on a renovation and it adds $8,000 to your home's value, that's an 80% ROI.
The ROI numbers I'm sharing throughout this article come from authoritative industry sources, primarily the annual Cost vs. Value reports published by Remodeling magazine and analyzed by the Joint Center for Housing Studies. These reports survey real estate professionals, contractors, and actual home sales across 119 U.S. markets to establish national averages.
Here's what you need to understand right from the start: these are national averages, not guarantees. Your actual ROI will vary based on your specific location, the quality of work, current market conditions, and local buyer preferences. A kitchen remodel that returns 113% in Phoenix might only return 85% in rural Vermont. That's not a flaw in the data-it's just reality reflecting different regional markets and buyer expectations.
According to data compiled for 2025 (the most recent comprehensive analysis available), exterior improvements continue to dominate the highest-ROI category. This makes intuitive sense when you think about buyer behavior. As Brian Mollo, CEO of Trusted House Buyers, notes: "Curb appeal projects often outperform indoor projects in ROI because they directly impact a potential buyer's first impression of a home." You never get a second chance to make a first impression, and that's doubly true in real estate.
Let me break down some current numbers for you. Peter Clark, a real estate professional working in the Portland, Oregon area, puts the overall picture in perspective: "I can tell you the average ROI for updating or remodeling a home-you get back seventy-four cents for every dollar invested on average." That 74% average is actually quite reasonable when you consider you're also getting the benefit of enjoying those improvements while you live there.
Cost: $4,513
Value Added: $12,102
ROI: 268%
If you're looking for the single best bang for your buck, garage door replacement takes the crown in 2026. This wasn't always the case-last year's ROI was already impressive at 194%, but this year it jumped to 268%. That means for every dollar you spend replacing your garage door, you're adding $2.68 to your home's value. Few investments perform that well, real estate or otherwise.
Why does this work so well? Think about what buyers see when they pull up to your house. The garage door often occupies a huge portion of the front facade, especially on homes built in the last 30 years. An old, faded, dented garage door screams "deferred maintenance" and makes potential buyers wonder what else you've neglected. A new garage door with clean lines, modern design, and smooth operation sends the opposite message-this home has been cared for.
Modern insulated garage doors also provide improved energy efficiency, which resonates with buyers concerned about utility costs. The relatively low cost (under $5,000 for most homes) combined with dramatic visual impact makes this one of the smartest starting places for any homeowner contemplating renovations. If your budget is tight or you're testing the waters before committing to larger projects, start here.
Cost: $2,355
Value Added: $5,087
ROI: 216%
Coming in second but still delivering exceptional value, steel entry door replacement returns $216 for every $100 invested. This project shares many of the same benefits as garage door replacement-highly visible, relatively affordable, and sends strong signals about home maintenance and security to potential buyers.
Your front door creates powerful first impressions and improves home security in measurable ways. Modern steel entry doors offer superior insulation compared to older wood doors, enhanced security features like reinforced frames and multi-point locking systems, and weather resistance that wooden doors simply can't match without constant maintenance.
From a practical standpoint, replacing an entry door is also one of the quickest renovations you can complete-often done in a single day with minimal disruption to your household. This combination of affordability, speed, visual impact, and functionality explains why it consistently ranks among the top ROI performers.
Cost: $11,287
Value Added: $23,476
ROI: 208%
Manufactured stone veneer has exploded in popularity, jumping from 102.3% ROI in 2023 to 208% in the current market. This exterior accent adds architectural interest and premium appearance to home exteriors without the structural requirements and expense of full stone construction. Think of it as creating the aesthetic of a stone facade at a fraction of the cost and weight.
The installation typically focuses on high-impact areas like the lower portion of the front facade, around entry doors, or as accent features on chimney exteriors. The manufactured product has improved dramatically in recent years, with textures and colors that convincingly mimic natural stone while being lighter, easier to install, and more uniform in appearance than the real thing.
This renovation works particularly well for homes that feel dated or lack architectural character. A well-designed stone veneer application can transform a plain ranch or builder-grade suburban home into something that looks custom and upscale. Given the strong ROI, this is another project where the numbers clearly support the investment from both a resale and curb appeal perspective.
Fiber Cement Siding
Cost: $20,619
Value Added: $18,230
ROI: 88.4%
Vinyl Siding
Cost: $17,410
Value Added: $13,957
ROI: 80.2%
Siding replacement represents a more substantial investment than doors or stone veneer, but it protects and beautifies your home's entire exterior. Both fiber cement and vinyl options deliver solid ROI numbers, though fiber cement edges ahead with its superior durability and fire resistance-qualities increasingly important to buyers in areas prone to wildfires or severe weather.
Fiber cement siding has remained remarkably stable in ROI performance, dropping only 0.01% from last year. Vinyl siding saw a more notable decline of 14.5%, settling at its current 80.2% ROI. This suggests market preferences are shifting toward more durable, premium materials even when they cost more upfront. Buyers seem willing to pay for fiber cement's advantages: resistance to rot, pests, and fire; lower long-term maintenance requirements; and a more substantial, higher-quality appearance.
The decision between vinyl and fiber cement often comes down to budget and long-term plans. If you're staying in the home long-term or selling in a competitive market, fiber cement's additional durability and premium appeal justify the extra cost. If budget is your primary constraint and you need to address failing siding quickly, vinyl still delivers respectable ROI while solving your immediate problem.
Cost: $27,492
Value Added: $31,065
ROI: 113%
When it comes to interior renovations, nothing beats a minor kitchen remodel for ROI. We're talking about refreshing rather than gutting-think cabinet refacing or fresh paint, new countertops (quartz and granite remain popular), updated appliances without changing the basic footprint, a modern tile backsplash, improved lighting fixtures, and new hardware on cabinets and drawers.
This project jumped from 96.1% ROI in 2024 to 113% in 2025, a significant increase that reflects what Brian Mollo, CEO of Trusted House Buyers, observes: "Because the kitchen is the most important room on the radar of home buyers, a cost-effective upgrade will net you the biggest return when you list your home for sale."
Why does the minor remodel work so much better than going all-out? Several reasons. First, you're keeping costs under control by maintaining the existing layout-no moving plumbing, gas lines, or major electrical work. Second, you're hitting the high-impact visual elements that buyers notice immediately: clean countertops, functioning appliances, cohesive design. Third, you're avoiding the risk of over-improving for your neighborhood, which becomes a real concern with six-figure kitchen renovations.
For families wrestling with whether to renovate or move, a minor kitchen remodel often provides the best of both worlds. You get a fresh, modern kitchen to enjoy now, and you recoup more than you spent if you sell within a few years. That's rare in the renovation world, where most projects return less than 100%.
Midrange Major Remodel
Cost: $79,982
Value Added: $39,587
ROI: 49.5%
Upscale Major Remodel
Cost: $158,530
Value Added: $60,176
ROI: 38.0%
Here's where ROI math gets sobering. Major kitchen remodels-the kind where you're moving walls, reconfiguring layouts, installing high-end appliances and custom cabinetry-see dramatically lower returns. Both categories did tick up slightly from last year (around 7% improvement), but they're still returning less than half of what you invest.
Does this mean you shouldn't do a major kitchen remodel? Not necessarily. Remember what I said earlier about worth versus value. If you're in your forever home or planning to stay for a decade, that dream kitchen might be worth every penny for the daily joy it brings. The issue arises when people sink $100,000 into a kitchen renovation expecting to recoup most of it within a few years. The numbers simply don't support that expectation.
The sweet spot for kitchen renovations appears to be that minor-to-moderate range where you're making significant improvements without completely gutting the space. Save the six-figure kitchen remodel for when you know you'll be there long enough to enjoy it, not just to boost resale value.
Midrange Bathroom Remodel
Cost: $25,251
Value Added: $18,613
ROI: 73.7%
Universal Design Bathroom
Cost: $40,750
Value Added: $20,148
ROI: 49.4%
Upscale Bathroom Remodel
Cost: $78,840
Value Added: $35,591
ROI: 45.1%
Bathroom renovations follow a similar pattern to kitchens-the moderate approach delivers better ROI than going ultra-luxe. All three bathroom categories improved from last year, which is encouraging news. Buyers increasingly seek bathrooms that feel like spa experiences with features like rain-style showerheads, double-sink vanities, soaking tubs, ample storage, and modern fixtures.
According to HomeLight's Top Agent Insights from Q3 2025, 18% of agents identified modernized bathrooms (along with kitchens) as the second most sought-after feature for buyers. Bathroom remodeling can increase property value by as much as 74% of the renovation cost, making it one of the stronger interior investments you can make.
Universal design bathrooms-those incorporating accessibility features like walk-in showers with benches, grab bars, and wider doorways-are gaining traction. As our population ages and multigenerational living becomes more common, these features appeal to broader audiences than just seniors. They represent forward-thinking design that many buyers appreciate even if they don't currently need the accessibility features.
The midrange bathroom remodel at 73.7% ROI hits that sweet spot where you're making meaningful improvements without over-investing. You're creating a space that feels current and comfortable while keeping costs reasonable enough that you'll likely recoup most of your investment at resale.
Replacing a garage door gives you the best return on investment (ROI) at 268%. Replacing a steel entry door (216%) and adding manufactured stone veneer (208%) are close behind. These changes to the outside of the house make it look a lot better from the street and don't cost too much. People can see them easily, and buyers like them a lot, which is why they are successful. They don't cost much compared to big changes to the inside of a house, and they show that the house has been well-kept. If you want to make the biggest difference, these projects are the best places for homeowners on a tight budget to start.
It depends on how long you have to wait and how your home is doing now. If you want to sell your home in less than a year, focus on changes that will get you the most money back, like painting, fixing small things, landscaping, and maybe even getting new doors. You get a lot more than you paid for with these cheap updates. It makes more sense to make small changes to the kitchen, bathroom, and outside of the house if you plan to sell in two to five years. You'll enjoy them while you live there, and when you sell, you'll get a lot of money back. If you're going to sell right away, big changes usually don't pay off because you're basically doing them for the next owner. You might want to hire a real estate agent in your area to help you decide which improvements would be best for your home.
The amount of money you make from renovations depends a lot on where you live. In Beverly Hills, a high-end kitchen remodel might pay for itself 95% of the time. In a small town in the Midwest, on the other hand, it might only pay for itself 50% of the time. Things like the local housing market and median home values, the weather (pools make sense in Arizona but not in Alaska), neighborhood standards and buyer expectations, local labor and material costs, and regional architectural styles and tastes all have an effect on ROI. The 30% rule is a good way to think about this: Don't spend more than 30% of your home's current value on renovations so that it doesn't become too nice for your neighborhood. A $50,000 kitchen remodel makes sense for a $300,000 home, but not for a $150,000 home that is similar to other homes in the area.
Yes, and a HELOC is often one of the best ways to pay for home repairs. The interest rates on a HELOC are usually between 7.5% and 8.5%, which is much lower than most other choices. This is because personal loans have higher interest rates and credit cards can quickly add up debt. The draw period structure, which is usually five to ten years, lets you get money when you need it instead of having to pay it all back at once. This is especially helpful for renovations that happen in stages or when you don't know how much they will cost in the end. But remember that your home is what secures the line of credit, so it's very important to borrow wisely. You should only borrow money for home improvements that you can afford to pay back. Also, you might want to put projects with a higher return on investment (ROI) first to make sure that the value of your home goes up enough to cover the loan.
According to the 30% rule, the total cost of renovations shouldn't be more than 30% of how much your home is worth right now. This rule keeps you from making too many changes to your home, which can make it hard to get your money back. For example, if your house is worth $300,000, the total cost of repairs should be less than $90,000. This is just advice, not a rule, so you can spend more if you want. But if you go over this limit, you should really think about whether you're doing the work to sell or just for fun. In neighborhoods where most homes sell for $250,000 to $350,000, putting in a $100,000 chef's kitchen might seem like a big deal, but it might not raise the sale price by the same amount. People who want to buy homes in that price range have different needs and budgets than people who want to buy homes that cost a million dollars.
Yes, you need permits for most plumbing, electrical, and structural work, as well as for putting in HVAC systems. There are different rules about permits in different places, but in general, you'll need one for any work that changes the structure of your home, its safety systems, or its main utilities. Most of the time, professional contractors will get the permits for you, but you should check this before you sign any contracts. Permits can cost anywhere from a few hundred dollars to a few thousand dollars, so be sure to include them in your budget. It can be very bad to not get permits to save money. For instance, work that isn't allowed can make a home worth less instead of more, and it can also cause problems with liability if something goes wrong. If an inspection shows that changes weren't allowed, it can also make it harder to sell a house. Title companies and mortgage lenders often want to see proof that big jobs were done with the right permits. You could save a few hundred dollars by not getting permits, but that could cause problems that cost thousands of dollars later.
You might be able to get a number of tax breaks if you make improvements to your home. You can deduct the interest on a home equity loan (HELOC) if you use the money to make improvements to your home and your total mortgage debt stays below $750,000. You can get tax breaks for making your home use less energy. These credits can be as much as 30% of the cost each year, but they can't be more than $3,200 for things like windows, insulation, and heat pumps. You can get a 30% federal tax credit for putting up solar panels until 2032. There is no limit on how much you can get. You may be able to deduct the cost of medically necessary changes, such as wheelchair ramps, grab bars, and other improvements for people with disabilities. Tax laws change all the time, and everyone's situation is different. Before you assume that your taxes will be handled a certain way, talk to a tax professional about your own situation. Don't let tax breaks be the main reason you want to remodel. Instead, think of them as helpful extras.
The schedule changes a lot based on how big the project is and when the contractor is free. Most of the time, it only takes one day to replace a door. Making small changes to the kitchen or bathroom usually takes two to four weeks. It usually takes six to twelve weeks to completely redo a kitchen. It takes between four and eight weeks to completely remodel a bathroom. It can take anywhere from three to six months to finish a basement, depending on how hard it is. Full-scale home renovations can take anywhere from three to nine months or longer for big projects. These timelines are greatly affected by how many contractors are available right now. Demand is still high in many markets after the pandemic, which could mean that start dates are pushed back by weeks or even months. If you plan ahead, you can deal with problems that come up out of the blue. If contractors find hidden water damage or if the tiles don't arrive on time, the bathroom remodel that was supposed to take two weeks could take three or four weeks.
If you know how to do basic things, it's a good idea to do your own cosmetic updates, like painting, landscaping, changing fixtures, and putting up tile backsplashes. You can save 40% to 60% on these projects and learn useful skills at the same time. But for anything that requires changing the structure, working on electrical systems beyond simple fixture swaps, plumbing beyond basic repairs, HVAC work, roofing, or complicated tile or finish carpentry, hire professionals. If you do a bad job on these systems yourself, your home could be less safe, lose value, and sometimes cost more to fix than it would have cost to hire professionals in the first place. A lot of buyers and their inspectors can tell when work is done by an amateur, which makes it harder to negotiate a sale. If you enjoy doing things yourself and are good at it, concentrate on small changes and finishing touches where mistakes can be fixed.
You should be careful about making some changes because they always have a low return on investment (ROI). Only do them if you want to have fun. In most places, swimming pools don't pay for themselves, but they do in warm places where most homes like yours have pools. Most people would rather have rooms that they can change to fit their needs than home offices or rooms that are very specific. Most of the time, luxury upgrades that go above and beyond what is normal in the neighborhood don't pay off. This is because buyers in the middle price range won't pay extra for features that are too much. A lot of landscaping with plants or water features that need a lot of care is only appealing to a small group of buyers and costs money over time. Adding a primary suite or making big changes to the floor plan costs a lot of money but doesn't pay off very well (24% to 36% ROI). You don't have to do these projects all the time, but you should know that you're doing them for your own benefit while you live there, not as investments.
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