Home value is an estimation of how much your house is worth if you put it on the market. One of the primary advantages of being a homeowner is that your home’s value may rise over time, but it can increase much more if you work on home upgrades and repairs.
Whether you’re planning to renovate your home for sale or just want to build home equity, making home improvements can increase your home’s value.
According to Angi, homeowners spent $376.9 billion in total on home improvements in 2021. Almost 65% of homeowners believe that the value of their home will continue to rise over the next 10 years, according to a NerdWallet survey.
5 Effective Ways To Increase Your Home’s Value in Slow Market
Due to a cooling real estate market, housing prices in your town may have plummeted, but there are effective ways to invest in your home right now to boost its market value. Here are the top 5 ways to increase home value:
1. Upgrading & Remodeling the House
- Remodel Your Bathrooms and Kitchen: You don’t have to completely renovate your bathroom or kitchen to increase their value. Just cleaning them thoroughly and adding some new cabinets, countertops, and replacing dated wallpaper can also boost a home’s value.
- New Sinks and LED Can Do a Magic: You may consider replacing a dated sink with a new one. You can unscale your kitchen’s and bathroom’s look by adding hanging lights or LED lights. You should go with energy-efficient lights to save more.
2. Focus on Curb Appeal
- Upgrade Your Exterior Doors and Windows: If your exterior doors are making noise or not working properly then you should consider replacing them with the latest ones. You also need to change the windows if they are very old fashion. You may also consider adding some showpieces near your doors or windows to give them an appealing look.
- Improve Your Exterior and Landscaping: The exterior of your home is the first thing to impress prospective buyers. Cleaning up your yard area and walkway can make a huge difference.
- Bright Flowers and a New Walkway: You can plant some good flowers to enhance the appearance of your exterior. You can make it more attractive by adding a new walkway or a new paver patio. Adding an exterior kitchen is also a good idea to increase your home’s value. But it will cost you higher than you expected.
3. Energy-Efficient Home
- Install Energy-Efficient Appliances: A sure way to attract potential buyers is to help them reduce their utility bills by making your home more energy-efficient. Energy conservation features can have a significant impact on home value. You can consider double-paned windows, enhanced attic insulation, LED lighting, and efficient appliances to entice energy-conscious buyers.
- Install Solar Panels: Installing solar panels can be a very good investment to increase a home’s value. In addition to lowering electricity costs, solar panels also provide you the opportunity to earn energy credits by returning any surplus electricity to the utility provider.
- 💡 Do You Know? Homes with solar panels sell for 4.1% more than homes without solar energy, according to Zillow Research.
4. Add Usable Square Footage
Additional space in your home is always a great way to attract potential buyers. As you can create an extra bedroom, bathroom, recreation room, or storage space. You can even turn the unfinished space into a rental unit if it meets the zoning regulations of your area.
- 💡 Do You Know? The National Association of Realtors found that every additional 1,000 square feet to a property boosts its sale price by at least 30%.
5. Home Staging
- Clean It Up: Home staging shows your home in its best light and helps potential buyers imagine themselves living there. Before starting any home improvement projects, it’s important to make sure that your home is in the best possible condition. Cleaning your entire home thoroughly truly improves its appearance.
- Decluttering The Stuff: You should also consider upgrading dated furniture and appliances to modern ones. Removing or decluttering unnecessary stuff or organizing it properly in innovative cabinets will also improve your home’s value significantly.
- Painting Can Add Higher Value: Applying a fresh coat of paint is always a great option to enhance the appearance of your home. Don’t forget to paint your exterior doors, gates, and windows.
How To Pay For Home Improvements To Increase Home Value
1. Home Equity or HELOC
A HELOC is a very flexible second mortgage. You are able to borrow money using the value of your house while paying a little (but varying) interest rate on the outstanding debt.
Your home is used as collateral for the line of credit when you borrow against the equity in it. When you settle your outstanding debt, the available credit is restored, just like with a credit card.
2. Cash-Out Refinance
You may borrow money for any purpose with cash-out refinancing. And it’s absolutely appropriate if the goal is home improvement. In that situation, you might even qualify for tax benefits.
3. Credit Card
If you just need a little amount of money for home improvements, you may be able to avoid a loan by using a credit card. Using an existing credit card to make payments may be easy, but keep in mind that cards might have high-interest rates, making borrowing money costly. Some credit cards may provide 0% interest for a specific length of time, which may allow you to fund your home improvement project more affordably.
4. Personal Loan
Consider a personal loan if you don’t have enough equity to qualify for a home equity loan, or HELOC. In most circumstances, the interest rate will be higher than home equity-based financing but lower than a credit card.
The amount you may be able to borrow and the interest rate you will pay is determined by criteria such as your credit and income. Because no collateral is often required, interest rates may be higher than with other lending choices.
Not every renovation project will increase your home’s value, so it’s important to invest wisely. Focus on current trends and functionality that can add value to your home. If you’re debating whether to sell your house and would like to make as much money as possible from the sale, a few home improvement projects can increase your property’s market value.
Frequently Asked Questions
1. How To Increase Home Value?
Home renovations and remodeling play a major part to increase a home's value. You may also consider adding some usable square footage to your home. This additional space can be converted into a bedroom, storage room, or rental unit. This way, you can improve your home's value and home equity better.
2. What Improvements Add Most Value To Home?
Installing solar panels and some energy-efficient appliances adds the best value to a home. Updating dated cabinets or countertops is also a great idea to maximize the house value. These upgrades will cost you a little more, but these are the best investments that will boost the home value much higher.
3. What are inexpensive home improvements to increase value?
Cleaning your entire home and decluttering the unwanted stuff, are the best inexpensive ways to improve the value of a home. Applying vibrant and fresh paint, planting some flowers, and installing some innovative cabinets also add the best value to your home with minimum costs.