The ROI of Home Renovations in Minnesota: What to Expect

Posted on by Satin Touch

Deciding to renovate your home is an investment, other than the immediate benefits are there other things to consider as ROI of home renovations? 

Follow along through this blog post to see if the renovations you had in mind, might be beneficial when it comes time to sell.

Deciding to renovate

The first step in this whole decision process is to decide if renovating is something you even want and can afford. 

Do you want to renovate?

You’re here for some reason, so renovation has at least been on your mind lately. Whether it’s your kitchen, bathroom, basement or other areas of your house, getting a return on your investment or ROI on home renovations is something to consider. If renovating is on your mind and something you plan on doing no matter what, knowing about your ROI may be a helpful tool. 

Why are you renovating?

If you’re thinking about renovations in your long term or “forever” home, the ROI of home renovations for you will look different than someone who is looking to fix something that has been bothersome in an attempt to sell their home for more. Moving forward in this post we will talk about personal ROI and monetary ROI.

Personal ROI

You bump into the same cabinet every single time you go around a corner. You wish to be able to use your basement for recreation or living and not have it be a cold cement space. You want to entertain but the three feet of task space makes cooking for more than three people really hard. You hate the color in your bathroom or wish the shower was bigger.

The list of reasons to renovate parts of your home for personal ROI could go on and on. It’s hard to quantify just how much ROI your home renovations will give you. But to go off the list above, you could widen a hallway or move a bank of cabinets to ensure that there is adequate space for moving around. Finishing your basement usually doubles your livable space in your house. So finishing your basement is a little more quantifiable, because you get double the square footage, usually another bathroom, more living space or bedrooms. This one is also great because it fits into monetary ROI too. Great designers and contractors can give your more tasking space in your kitchen without knocking down walls, moving plumbing, or generally change too much about your kitchen, keeping your costs lower than you may expect while giving you more space. 

Monetary ROI

When thinking about monetary ROI on home renovations, thinking about the problems is going to be more practical than the desires. Remodeling and renovations can absolutely boost the sale price of your house. Just make sure to be strategic about where you spend your money, or it may not matter in the long run. 

One thing to consider when thinking about renovating your home with the idea to sell is your market. The likelihood of selling your home hundreds of thousands of dollars above the average price in your area just because you did $100,000 in renovations is super low. Recently a homeowner tried to sell their home for $100,000 over the average home value in their neighborhood because they had put about $75,000 worth of renovations into their home. These renovations included a deck, major landscaping, a partially finished basement, solar panels, and minor cosmetic upgrades inside the home. What they didn’t account for was, their neighborhood heavily catered to young and growing families. With only two bedrooms and two bathrooms, this house was not renovated for a family to use. The deck certainly adds value, but a family would have much rather had more bedrooms than extensive landscaping. Or a fenced in yard over solar panels. 

I told that story in Monetary ROI because they definitely made the renovations they did for themselves, or Personal ROI, but they expected Monetary ROI. They did not sell the home, and are still living there enjoying the renovations they made, but they didn’t see the ROI on renovations that they had hoped to. 

People that will see Monetary ROI on renovations are people who use those renovations to solve a big problem. According to the Remodeling 2023 Cost vs. Value Report (www.costvsvalue.com) the renovation with the highest ROI in the Midwest in 2023 was HVAC conversion to electrical. Followed by siding replacement, vinyl, and the addition or replacement of manufactured stone veneer. Check out that link for the full report and to see where your highest ROI could come from. 

Better left to Personal ROI

Here is a list of awesome renovations that may leave you feeling a little better if you do them for you, than for your homes next owners, according to Cost Vs. Value

  • Major Kitchen Remodel
  • Upscale Primary Suite Addition
  • Upscale Bathroom Addition
  • Upscale Bathroom Remodel
  • Sunroom Addition
  • Swimming Pool Addition
  • Home Theater Addition