How Home Renovations Impact Appraisals

How Home Renovations Impact Appraisals

There are pros and cons when it comes to home renovations. The biggest pro is that the
renovations improve your home and can make it more enjoyable for you. The major con is
that sometimes renovations can cost more than they are worth. When planning for home
renovations, it pays to plan carefully and make smart choices with return on investment in

Renovations that Impact Appraisal Value

Changing Your Color SchemeMan painting a wall white

Nearly two-thirds of real estate agents recommend repainting the inside of a home before putting it on the market, according to a 2017 survey by Houzz. Additionally, other studies show a fresh coat in the right shade can add thousands to your home’s sale price. Repainting can be one of the cheapest renovation projects, but it needs to be something neutral. Repainting with bright or other non-neutral colors can back-fire.

Incorporate Landscaping

A little lawn care can go a long way. Curb appeal is an important factor to a home appraisal.
Consider simple upkeep for your yard such as:

  • Mowing
  • Weed-eating
  • Gardening
  • Pressure washing the sidewalks

Don’t implement any over-the-top landscaping projects, such as elaborate designs,
fountains, or stone walkways. These projects won’t hold their value.

Implement Energy-Saving Methods

There are various methods you can implement to ensure your home is as energy efficient as
possible. The most important area to focus on is ensuring your home is fully insulated.
Taking this step can cut your heating bills by nearly 10 percent, according to the
Environmental Protection Agency.
Additionally, replacing old windows with energy-efficient ones can save you between $25
and $450 a year in heating and cooling costs. Other minor things include replacing simple
weather-striping at doors

Renovations That Have Little to No Impact on Home Appraisals

Many home renovations do not make financial sense. These are typically done from
emotions and not practicality and functionality. The following are renovations that
contribute the least value to a home:

  • Installing a pool
  • Converting a bedroom into a leisure space such as a playroom or wine cellar
  • Changing hardwood flooring to carpet
  • Closet renovation (adding shelves)
  • Adding bedrooms or bathrooms
  • High-end fixtures and finishes
  • Adding additional electrical outlets

Renovations can greatly impact the appraisal value of the property, either negatively or
positively. Consider what would contribute the most and the least value. It is important to
consider several other factors before implementing renovations.Paint swatches and counter top tabs


Factors to Consider with Renovations


A home’s location – what city it is in and even what part of that city – is key to this popular question. For example, adding a central air conditioner to a home in the South may add significant value, while putting one in a home near the Pacific Northwest may not have much impact.


Which room are you considering making renovations to? According to one national survey,
kitchen remodels returned an average of 88 percent of the investment. In other words, a
$10,000 kitchen remodeling project would add approximately $8,800 to the value of the
home. Bathrooms were second, returning 85 percent.


The actual age of a home is not what is most important when appraising a home. An
appraiser is more concerned with the effective age. According to The Appraiser Coach, if you
can take 10-15 years off the appearance of your home, you are doing yourself a huge favor.
The value of a home is determined by the buyer’s perspective.


Definitive Valuations is North Alabama’s premiere appraisal firm. Our mission is to provide
superior valuation and consulting services in Huntsville, Alabama, and surrounding areas.
Our staff strives to understand your needs and to provide the best solution for your
situation – whether for financial planning, relocation, tax dispute, legal matters, pre-listing,
or any other purposes. Discover more here.