If you are considering a home renovation project for 2023, you might be wondering as well whether you may or may not actually be able to afford them. Due to increasing inflation and supply shortage, this might be the case for many americans.
According to Angi, in 2022 homeowners spent in average $8,484 on home improvement projects. Many americans expect to spend the same amount in 2023, with 28% planning to spend less and 22% expecting to spend more.
In this article we will show you the top renovation projects that increase your home value and their respective costs. We will also talk about the main factors that affect home renovation costs.
Table of Contents
Top Home renovation projects
The following best renovation, remodeling and home improvement projects that can increase your property value are based on Opendoor’s data on thousands of recent home sales.
|
Home Improvement Project |
Average Resale Value % Increase |
Average $ Resale Increase |
|
1. Add a pool |
7.3% |
$22,000 |
|
2. Finish a Basement |
6.6% |
$22,000 |
|
3. Add up to a 3rd Bedroom |
6.2% |
$20,000 |
|
4. Add a Full Bathroom |
5.7% |
$18,000 |
|
5. Add Living Space |
5.3% |
$17,000 |
|
6. Full Kitchen Remodel |
4.8% |
$15,000 |
|
7. Convert Existing Sq. Ft. to a 2nd or 3rd Bedroom |
4.3% |
$14,000 |
|
8. Full Bathroom Remodel |
3.7% |
$11,000 |
|
9. Install Hardwood Flooring |
3.4% |
$10,000 |
|
10. Add a Half Bathroom |
2.9% |
$9,000 |
|
11. Add an Attached Garage |
2.2% |
$7,000 |
The Inflation Reduction Act and Home Renovation
Signed by president Biden on August 16, 2022, the Inflation Reduction Act (also known as the climate bill) allows homeowners to be eligible for tax credit incentives by making crucial, cost-saving energy efficiency improvements to their home, such as solar panel systems. These tax credits are also available for purchases of new and used electric vehicles in 2023.
This means great news for homeowners whose home renovation plans include installing a solar panel system on their roof during 2023.
Home Renovation Costs
Every home renovation is composed of several elements, including supply chains, material costs and labor costs. These are the main factors that affect your home renovation costs.
Supply Chains
The cost of the materials used will be defined by the availability and price of raw materials, including logistic costs and labor costs. Recently, the pandemic disrupted supply chains worldwide, resulting in increased demand and low availability for certain products. Also, if you are purchasing raw materials from other countries, you will need to consider the taxes involved.
Material Costs
Due to fluctuations in the supply chain, there are certain areas where material costs are more expensive, such as in large cities. To save in costs, it may be worth exploring alternate materials for your project or shopping around for discounts.
Labor Costs
There is an increased demand for skilled people, which can greatly impact the cost of labor. It is important to consider comparing quotes from different companies, as well as consider any additional costs such as travel or equipment rental fees.
Architectural Design
Lastly, it is advisable to hire an experienced architect or designer to lead your renovation.
Cuevas architects is an architectural design firm based in Houston TX. With more than ten years ofexperience, specializing in custom luxury single family homes, multifamily homes, and commercialarchitecture combined with powerful architectural visualization tools to communicate the future with our clients.
If you wish to inquire about our architectural design services feel free to leave your contact information below.
