Valuing your home improvements

When is remodeling a waste of money?

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It would be nice if you could count on getting one dollar back when you sell your house for each dollar you invested in renovations. Most people hope for more than a dollar-for-dollar return. In reality, many improvements return less than the amount invested. For example, the 2004 Cost Versus Value Report, recently published by the National Association of Realtors, reported that nationally, the average percent recouped on a bathroom remodel was only 90.1 percent. It was 88.1 percent for a deck addition, 81.2 percent for a family room addition, and a mere 79.4 percent for a major kitchen remodel. Does this mean that remodeling is a waste of your time and money? It can be, especially if you go about a renovation in a haphazard fashion. It's important to do due diligence investigations before embarking on a remodel project, just as you would if you were considering buying a new home. There are many variables to consider. First, consider that the figures quoted above are national averages....