Professional Referrals

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Value of Home Improvements

You may be thinking about those spring-time projects that you will need to tackle this year, like landscaping the garden, rebuilding a patio or fence, changing older windows and doors, a new roof, or even remodeling your basement, kitchen or bathroom. If you tune in to some recent popular TV programs like “Extreme Makeover – Home Edition”, you will surely catch the home makeover bug. If you live in a freehold house, you should be spending an average of 1% of your home value annually, on maintenance, just to keep it in good repair and to prevent it from declining in value, according to “Home Buying for Dummies” by Eric Tyson and Ray Brown.

Renovating a home, may also be an important consideration for you in 2010, if you are thinking of listing your home for sale. Remember that the right renovations can help you to maximize the resale value of your home. The renovation payback statistics were extracted directly from the Appraisal Institute of Canada’s website and the data is current as of January 2010:

Top Four Renovations that will give you the Highest Payback Potential
Bathroom Renovation75% – 100%
Kitchen Renovation75% – 100%
Exterior Paint50% – 100%
Interior Paint50% – 100%
Other Renovations Payback Potential
Basement Renovation50% – 75%
Construct a Garage50% – 75%
Exterior Siding50% – 75%
Flooring Upgrade50% – 75%
Furnace/Heating System Upgrade50% – 75%
Install a Fireplace50% – 75%
Recreation Room Addition50% – 75%
Window/Door Replacement50% – 75%
Build a Deck25% – 75%
Concrete Paving25% – 75%
Install Central Air Conditioning25% – 75%
Roof Shingle Replacement25% – 75%
Nine Renovations that will give you the Lowest Payback Potential
Asphalt Paving25% – 50%
Build a Fence25% – 50%
Install a Home Theatre Room25% – 50%
Interlocking Brick (walkways)25% – 50%
Interlocking Paving25% – 50%
Landscaping25% – 50%
Install a Whirlpool Tub0% – 50%
Install a Skylight0% – 25%
Install a Swimming Pool0% – 25%

You can check your renovation investment plans using the Appraisal Institute of Canada’s on-line tool. The name of this tool is RENOVA and it is an excellent resource for homeowners. You may visit the site by going to this website:

http://component.aicanada.ca/e/resourcecenter_renova_all.cfm

Remember that the referenced website link is only a guide, and you should always carefully consider that proper appraisal values and returns can be provided by an accredited appraiser holding a CRA or AACI designation. It is also important to mention that an appraiser will also assess other factors, about the home to complete accurate appraisal results, for example, the neighborhood, recent real estate activity, lot, location, etc.

Canada AM has been running an informative real estate market series that commenced on January 25, 2010. Featured on Tuesday’s program was Mr. Ed Saxe of Edjline Appraisal Services. Mr. Saxe is a certified Canadian Residential Appraiser as well as the President of the Ontario Association of the Appraisal Institute of Canada. Mr. Saxe discusses that the number one investment returns come from kitchen and bathroom renovations, however, as a homeowner, he advises that discretion is required when spending. Mr. Saxe advises homeowners to carefully consider just how much they are spending and where they are spending. For example, he mentions that you would not be wise to spend $50,000 on a kitchen renovation if you are living in a home that is only worth $200,000. A home renovation should be relative to the market and the neighborhood in which you live. You can view the current live video clip at the following link:

Nora Cole

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