Column: News From SFAR

Adding value to your investment

By: Paco Arguello
Published online: Sunday, February 05, 2012
Appeared in: Home, Santa Fe Real Estate Guide
Edition: February 2012 Vol. 14 No. 11

With construction costs rising and the hassles associated with taking on a renovation project, many homeowners can be reluctant to tackle certain projects when it comes to remodeling their home. However, several inexpensive exterior replacement projects are not only crucial to a home’s regular upkeep, but they also add value and curb appeal.

Having a construction and property- management background qualifies me as the “go-to guy” for family members who may need assistance with home renovation projects. Plumbing, electrical, painting and flooring are some of the projects that keep us busy trying to get the most out of our investment.

Exterior replacement projects continuously outperform other remodeling projects in terms of resale value, especially window and door replacements. These types of projects are considered essential to regular home maintenance, so homeowners will need to implement them anyway to keep their house functioning properly. The good news is that these projects do not require expensive materials. Many exterior replacement projects can be performed with durable, low-maintenance materials and they have the added bonus of instantly adding curb appeal, which is important to those looking to sell.

The 2011-12 Remodeling Cost vs. Value Report (from Remodeling magazine) compares construction costs with resale values for 35 midrange and upscale remodeling projects in 80 markets across the country. Realtors provided their insight into local markets and buyer home preferences within those markets. Overall Realtors estimated that homeowners would recoup an average of 57.7 percent of their investment in 35 different improvement projects, down from an average of 60 percent last year.

An exterior door and two garage-door replacements were among the top exterior replacement projects. The steel entry door replacement is the least expensive project in the report, costing little more than $1,200 on average and is expected to recoup 73 percent of cost upon resale. Both the midrange and upscale garage door replacements are expected to return more than 71 percent of costs.

The desirability and resale value of different remodeling projects varies by region and metropolitan area. There are regional differences when it comes to the resale value of particular remodeling projects. Realtors can help homeowners decide what low-cost-improvement investments will provide the most upon resale in their particular market. It’s important to keep in mind that resale value is just one factor among many that homeowners must take into account when making a decision to remodel.

Rubel “Paco” Arguello is a Santa Fe native and interim chief executive of the Santa Fe Association of Realtors. Contact him at 982- 8385 or paco@sfar.com. (Editor’s note: We have changed the title of this column, which was previously known as “From the Director.”)