Phoenix Home Remodeling – Cost vs. Value 2011

People will often tell you remodeling your home is a great investment. But faced against a slowly recovering economy, a crippling housing market, and job uncertainty – how true is that statement today and how will it change it tomorrow?

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This year’s Cost vs. Value report  assess the ROI on multiple home remodeling projects in different regions of the country. The results show a market shift from larger remodeling projects, to smaller home improvement projects such as window replacement. Traditionally, kitchen and bathroom remodeling saw the highest ROI and were considered your best bet. An average homeowner might expect an 80-85% ROI on a kitchen remodel. Today, that number has dropped to 57.7% for 2011-2012.

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Although replacement projects historically outperform remodeling projects, the gap has grown dramatically over the last few years. The cost-value ratio for window and door replacement for 2011-2012 is 71.6%, nearly 14 points higher than a kitchen remodel. The main reason is due to the fact that a replacement project is significantly less than a home remodeling project. Most replacement projects such as window or door replacement instantly improves curb appeal and can decrease utility cost. This is an important deciding factor for a lot of homeowners who have recently become more conscious about their energy bills. The value of saving money in the long term often outweighs aesthetic trends and conveniences such as double ovens or larger kitchen islands. Replacement projects are often done out of necessity. To gauge a better idea of the current housing and remodeling market, it’s better to go to the source and ask homeowner’s if they believe the ROI of a home remodel is worth the investment.

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According to Hanley Wood’s “Housing 360″ research, 42% of homeowners believe it is a good time to remodel. This number jumps to 56% when the household income is 100k or more. Another optimistic sign is the fact that 80% of homeowners are relying less on credit, and more on cash from their savings.

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You can view the report for Phoenix, AZ at http://www.remodeling.hw.net/2010/costvsvalue/division/mountain/city/phoenix–az.aspx.

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