Bay Good News
Remodeling Magazine has completed their annual Cost vs. Value survey for 2008-09. The report compares the cost of remodeling projects to the value returned. For years, this report has been used as the benchmark for the return on investment (ROI) of home improvement projects by realtors, remodeling contractors and real estate appraisers. What stands out this year is how much better off the San Francisco Bay Area is than the rest of the country. Yes, there is good news when it comes to housing!
Bay Good News
The 2008-9 Cost vs. Value survey shows that the San Francisco Bay Area still outshines the rest of the country when it comes to ROI for home remodeling. Bay Area ROI is lower than in previous years - and well off its high set in 2005 - but, for most home improvement projects, the returns are 90% or greater. For instance, a minor kitchen remodel returns 131.5% of the cost, while a major kitchen remodel returns 100% of the cost.
Bay Good News
Nationally, exterior renovation projects top the list for the best ROI. With the current surplus of housing inventory for sale, it stands to reason that projects that enhance curb appeal - such as siding replacement and window replacement - top the list. These products offer durability, improved energy efficiency and buyer appeal. They are also some of the most economical home improvement projects. In the Bay Area, exterior projects return between 92.7% to 112.5%.
Bay Good News
Given the Bay Area climate, it is no surprise that the addition of a deck is close to top of the ROI list. The addition of a mid-range wood deck will return 118% of the cost. (A mid-range deck for the purposes of the survey is a 16 x 20 deck built with pressure-treated timber.) A deck built with composite material costs more and returns a bit less at 110%.
Bay Good News
The Cost vs. Value survey can help homeowners see what projects have potential for the best ROI, but it is based on averages and assumptions. Housing in the Bay Area varies greatly, from a San Francisco row house to an Orinda ranch-style house on an acre of land. The underlying principle is that good design built with durable materials will consistently have the best ROI.
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