Beware Homeowners: Not All Property Renovations Yield Returns

Release Date: April 21, 2006



CHICAGO – Want to know how to get the most out of your property renovations or how recently completed upgrades have influenced the value of your house? Instead of relying on Internet valuation sites, which often fail to take upgrades and home renovations into account, contact a professional real estate appraiser who can advise you on how different improvements can increase the value of your property.

"A common misconception among homeowners when it comes to home remodeling and renovation is that cost equals value," explains Richard Powers, MAI, SRA, president of the Appraisal Institute. "However, not every renovation or remodeling effort will pay off at closing."

For consumers looking to invest in or sell their house, Powers offers the following advice:

    - Invest in basic upgrades, such as fresh paint (use neutral colors) and new fixtures
    - Avoid over-improvement by sticking to what’s standard in your neighborhood
    - Consider adding a bathroom, which is an appealing feature for home buyers
    - Projects that add square footage to bring a house up to – but not beyond – community norms generally pay off the most

To ensure that you get the most value out of your home improvement consider consulting with a designated member of the Appraisal Institute. When discussing home or business renovation and remodeling, a professional real estate appraiser can advise you on how different improvements can influence property value. For major renovations the appraiser can complete a feasibility study – an analysis of the property, the cost of rehabilitation and an estimate of the property’s value after improvement.

To find an MAI, SRPA or SRA designated appraiser in your area, or for more information on consumer tips for home renovation, visit the Appraisal Institute at www.appraisalinstitute.org/resources/consumertips.asp.