When considering a kitchen remodel, the question on most homeowners’ minds is, “Will this increase my home’s value?” To get some insight, I sat down with Sarah Bennett, a seasoned real estate agent who has seen the market from all angles. As we discussed the ins and outs of kitchen remodeling, it became clear that the decision isn’t always straightforward. Our RamseyTrusted real estate agents like Sarah are here to help you navigate these decisions, particularly when it comes to deciding if your primary motive is to increase home value or to create a kitchen you love.
Understanding the Motivation
Sarah started by explaining that the first step is determining your primary motivation. “You need to be honest with yourself,” she said. “Are you remodeling because you can’t stand your current kitchen, or are you doing it with the intent to sell and increase your home’s value?”
These two motivations can lead to very different approaches and budgets. For instance, a homeowner who plans to stay in their house for several more years might splurge on high-end finishes and custom cabinetry. In contrast, someone looking to sell might focus on more cost-effective updates that still make a significant impact.
The Cost Spectrum
Sarah pointed out that the cost of a kitchen remodel can vary widely. “People often get sticker shock when they see how much a remodel can cost,” she noted. “A simple update might run you $21,000, while a gourmet kitchen could easily exceed $100,000.”
She mentioned that according to Remodeling Magazine’s 2018 Cost vs. Value Report, the average cost to renovate a 200-square-foot kitchen with mid-range finishes is just under $64,000. This includes new appliances, lighting, and flooring. However, she emphasised that it’s possible to spend much more or much less, depending on your choices.
Budgeting Smartly
To navigate these costs, Sarah recommended a few budgeting tips. “First, spend the bulk of your money on items you don’t want to replace often, like appliances and cabinetry,” she advised. “Second, be mindful not to over-improve your kitchen. You won’t recoup the costs if your home becomes the most expensive on the block.”
She also highlighted the importance of setting aside 10–15% of your budget for unexpected expenses. “Renovations never go exactly as planned,” she said, “so having a contingency fund is crucial.”
Saving Money
For those looking to save money, Sarah suggested practical strategies. “Start with a solid plan,” she advised. “You don’t want to install new counters only to realise you need to remove them to put in a farmhouse sink.”
She also recommended less expensive updates like painting or refinishing existing cabinets, installing a new tile backsplash, and even painting appliances to give them a fresh look. “These changes can make a big impact without the huge price tag,” she said.
The Impact on Home Value
One of the most critical factors in deciding whether to remodel is understanding how it will impact your home’s value. “An updated kitchen can certainly boost your home’s value and help it stand out to prospective buyers,” Sarah explained. “However, that doesn’t mean you’ll recoup the total cost of the remodel when you sell.”
She cited that the national average return on investment (ROI) for a major upscale kitchen remodel is about 54%, meaning you might recoup $68,000 on a $126,000 project. For a minor remodel, the ROI can be as high as 81%, with an average cost of $21,000 and a recouped amount of $17,000.
Local Market Influences
Sarah also stressed that ROI can vary significantly based on your location. “In some areas, like the Pacific region, you might see an ROI of up to 93% for a minor remodel,” she said. “In other areas, like North Dakota or Iowa, the ROI might only be around 68%.”
This variability underscores the importance of consulting with a local real estate expert. “They can give you the best advice based on the specifics of your market,” she added.
Is It Worth It?
Ultimately, the decision to remodel your kitchen depends on your goals. “If you’re selling soon, it may not be wise to invest $60,000 in a new kitchen if your agent thinks you’ll only recoup $40,000,” Sarah advised. “In that case, smaller updates might make more sense.”
On the other hand, if you plan to enjoy the kitchen yourself, the investment can have significant personal benefits. “Many homeowners report healthier lifestyles, more family time, and increased home cooking after a remodel,” she noted.
Expert Advice
To wrap up our discussion, Sarah emphasised the value of consulting with an experienced real estate agent. “We can help you determine how much to spend without overdoing it and make the most of your home’s standout features when it’s time to sell,” she said.
In the end, whether your goal is to increase your home’s value or create a kitchen you love, the advice of a trusted real estate agent can guide you through the process.
By Oliver Jenkins
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