Planning a Home Addition I Can Afford

Answered by Jeffrey ~ May 11, 2010 ~ 2 Comments » | Respond to this question

I've read that kitchen and small bath additions have a good return on investment. But my husband would rather add a sunroom. Considering we live in Chicago, is his idea better than the kitchen or bath addition?

Alexis T. ~ Chicago, Illinois

Jeffrey Anderson

Hi Alexis, All three sound like good ideas, but evidently homebuyers in Chicago, Illinois place more of a premium on showering and cooking than they do enjoying the sunset. I did a little research and according to the latest remodeling data in Chicago, Illinois you can expect to get about 43 percent of your costs back if you adda sunroom. That means if you spend about $20,000 on adding a sunroom, a homebuyer might pay an additional $8,600 over the cost of what they would have paid before you added the sunroom.

On the other hand you can get a fairly decent return on your investment with a kitchen remodel or a bath addition. The same data shows that for 2009-2010 homesellers could expect to get about 62-69 percent of their costs back for a kitchen remodel, the high end of the scale being for a major remodel. A bath addition may get you about 50 percent of your costs back.

One thing to keep in mind is that these numbers are based on a recovering economy that is not quite healthy yet, especially in the area of real estate. All of these numbers may have been over 100 percent back in 2002 and 2003, and as the housing market continues to improve they should go up as your home value goes up. A lot of how much of your initial investment you should receive back can depend on how long you plan to stay in your home. If you plan on selling in the next year or so, those percentages may be fairly accurate, but if you plan on staying in the home for another 10 years or longer, those numbers could be much higher. A room addition or remodeling project is usually a pretty good investment, and even more so when your family gets to enjoy it prior to selling the home.

This could be a could time to do any of these projects as a lot of very good contractors are looking to add to their workload for the summer, and may be pricing their projects accordingly.

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