Monday Market Update: Remodeling Reasons

You have no doubt heard about the famous organizer who encourages people to consider if an item ‘sparks joy’ when deciding what to keep or give away. A recent article from Realtor.com® encourages homeowners to apply the same philosophy when thinking about a remodeling project.

In ‘Upgrade Your Kitchen To Boost Your Joy and Your Home Value at the Same Time’, experts discuss that many homeowners “are laser-focused on return on investment (ROI).” Yet the reality is that there are few (if any!) home renovations that actually provide a true dollar-for-dollar ROI. While certain improvements may attract more buyers or add perspective to the overall condition of the home, in general the "70% rule" applies. 

- A very general guideline is that renovations add a return of 70% of your initial investment.

- Thumbtack research reports that a well-maintained home can sell for 10% more than a similar home in average condition.

- For a map of statewide averages on ROI vs. cost on various projects, check out JLC’s 2024 Cost vs Value Report.

While thinking about ROI is wise, Jessica Lautz (Deputy Chief Economist and VP of Research with NAR®) reveals that “Homeowners undertake remodeling projects for numerous reasons, but what remains intriguing is the disparity between the joy experienced post-remodel and the actual cost recovery.” Those looking for a home improvement project that returns in equal parts investment and enjoyment should absolutely look at the heart of the home: the kitchen!

The NAR® 2025 Remodeling Impact Report verifies that not only is a kitchen a space used multiple times per day, but it is a space of the home that is in high demand. In the last 2 years, nearly 50% of Realtors® report that they have seen an increased demand for kitchen upgrades. In fact, 30% of agents recommend completing a kitchen remodel before listing a home. The return on investment of an updated kitchen is about 60% (for both major and minor projects) – yet the rewards don’t stop there.

Homeowners report several enjoyment-based outcomes from a kitchen remodel, outcomes that they enjoy everyday! The NAR® report identifies these as improved functionality and livability, durable and long-lasting results, materials and appliances plus enhanced beauty and aesthetics.

While it may seem too good to be true to have it all – maximum ROI and greatest enjoyment - experts say it is possible. A well-thought out and strategic project will account for what buyers are likely to want in the future, and what you will enjoy living with today. For a kitchen, that usually means top priorities are function, flow, storage and timeless updates with neutral finishes.

We encourage you to consider applying the combination of ROI and joy to not just a kitchen remodel, but to any area you improve in your home or garden. After all, the best things in life are all about balance!

All my best,

Bobbi

Bobbi Decker
DRE#00607999

Broker Associate, Bobbi Decker & Associates
650.346.5352 cell
650.577.3127 efax
www.bobbidecker.com
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