Home improvement is a multibillion-dollar industry that includes the building, repair, and maintenance of homes. It also refers to the alteration, remodeling, and restoration of existing home structures, such as changing room layouts, adding windows or doors, improving electrical systems, ventilating and air conditioning, and installing new kitchens, bathrooms, and other fixtures. Other common home improvements include replacing flooring, carpeting, and painting. The home improvement industry has seen excellent growth results in recent years, particularly during the COVID-19 pandemic and afterwards. This trend is attributed to homeowners upgrading their homes in order to recoup their renovation investments and remain comfortable during the pandemic.
Many television schedules are filled with shows like Fixer Upper or This Old House, luring viewers to embark on a do-it-yourself home improvement project. While the satisfaction of completing a home improvement project can be high, it is important to consider the impact of a renovation on a property before you pick up that sledgehammer. A poorly executed home improvement can decrease a property’s value, increase the cost of reselling, or even make it impossible to sell in the future.
When you’re considering a home improvement, look at your property through the eyes of a potential buyer. Oftentimes, a homebuyer’s taste is determined by the appearance of surrounding homes. Avoid making improvements that go beyond the current style of your neighborhood and will not appeal to a wide range of buyers.
The best way to ensure your home improvement project will have a positive impact on your property is by hiring a reputable contractor. Contractors vary widely in price, experience, reputation, and ability to meet deadlines. When choosing a contractor, be sure to get estimates from more than one company and compare prices, services, and guarantees. A contract should contain a detailed timeline for work to be completed, a payment schedule and as many specifics as possible to protect your interests.
Most homeowners understand that a kitchen or bathroom remodel is likely to result in a high return on investment, however, it is important to remember that not all home improvement projects will yield the same return on investment. Many common projects, such as putting in an above-ground swimming pool or adding a media room, do not add significant value to your home. However, other more modest renovations can yield a high return, such as replacing worn doorknobs or painting rooms. Many home improvement projects also provide tax benefits; energy-saving improvements, for example, may be eligible for a tax credit. This credit is available to both commercial and residential customers and is based on the cost of installation. The credits may also be applied to the cost basis of the property when it is sold, reducing the capital gains tax you might otherwise have to pay. However, it is important to consult with a tax professional before implementing these types of changes. The tax laws are complex and the rules change frequently. Therefore, it is important to stay up-to-date on the latest rules and regulations.