15 Expensive Home Improvements That Rarely Pay Off
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Home improvements can get slippery fast. You begin with a straightforward idea to update your kitchen and wind up in marble countertops, wise machines, and custom cupboard work that can cost more than your vehicle. Many renovations are tempting but not all add value to your property. Not all upgrades turn out to be a smart investment, as some are more of a personal indulgence.
Before you spend a lot of money on a home improvement, take a second to ask yourself, ‘Will this really pay off?’ In theory, many upgrades sound great, but they often don’t impress potential buyers or recoup their costs when you go to sell. Let’s dig into some of the most common home upgrades that can make a hole in your pocket but never fill it back up.
High-End Kitchen Remodels
While the kitchen may be the heart of the home, going too luxe with finishes and top of the line appliances may be a wasted expense. A functional, up–to–date kitchen will help sell a home, but spending $100,000 to completely renovate one will rarely yield a big return on investment. A Zillow report says that upscale kitchen remodels typically recoup only about 54% of their cost at resale. Excessive features don’t always impress buyers, even if they do appreciate a well maintained kitchen.
Backyard Pools
For many homeowners, a pool is a slice of paradise—until the bills come rolling in. These are expensive to install and costly to maintain and often don’t appeal to every buyer. They might be considered a safety hazard for families with young children, and if you live in a cooler area of the world, you won’t be using them for more than a few months of the year.
Custom Landscaping
A professionally designed garden makes a big difference to the curb appeal of your home, but spending tens of thousands of dollars on custom landscaping rarely pays off. People buy those nice yards, but most people don’t want to pay extra for exotic plants, water features, or an outdoor kitchen. They could view such elements as added cost or maintenance. A lush garden is nice, but don’t think it will grow the value of your home.
Home Theaters
Who wouldn’t want a private theater with reclining seats and surround sound system? However, if you aren’t selling to a movie buff, it’s probably going to be viewed as a luxury rather than a necessity. Too many potential buyers would rather reclaim the space as a bedroom, office, or gym, than a walk in closet.
Solar Panels in Certain Areas
While solar panels can be a great way to cut energy bills, their effect on resale value depends greatly on that location. Solar panels are a big selling point in states such as California, where energy costs are high. In areas where electricity is cheaper or there’s less sunlight, the upfront cost of installation will likely exceed the savings. On average, homes with solar panels sell for about 4 percent more, according to a study by Zillow, but that doesn’t always even equal the cost of installation.
Wine Cellars
While a walk in wine cellar may make you feel like the wine connoisseur, it doesn’t speak to the average homebuyer. For most, this upgrade is impractical and consumes valuable square footage. If you don’t live in Napa Valley, where wine culture is king, you could find yourself soon toasting a loss when it’s time to sell.
Over-the-Top Bathrooms
Indulgent luxury bathrooms equipped with steam showers, heated floors and soaking tubs are rare — and rarely worth their hefty price tags. Clean, functional bathrooms are what buyers want, but they are unwilling to pay for the luxurious upgrades. A Zillow report indicates that an upscale bathroom remodel will recover just 56 percent of its cost, another example of where less is often more.
Room Conversions
Even if transforming a bedroom into a home gym, craft room or library fits your lifestyle, you may find that many buyers will be turned off by it. Bedrooms are a value add to a home and losing one, especially in smaller properties, will affect your bottom line. You’re better off using the room how it was intended and making personal touches removable.
Smart Home Systems
Trendy smart home high tech systems that control your lights, locks and thermostat from your phone can be a mixed bag in terms of resale value. Some buyers love the convenience while others feel they’re unnecessary or intimidating. It also changes quickly—today’s state of the art system could be out of date in a few.
Living in the Garage
While it might seem like a smart way to get more square footage by converting your garage into a living area, it doesn’t usually work. Most buyers want a functional garage to park and store things in. In suburban areas, losing this space can be a deal breaker; as most people consider a garage to be essential.
High-End Additions
A sunroom, conservatory, or second story balcony may seem like a great idea, but these are usually pretty expensive for what you get back. Extra space might be appreciated by buyers, but they won’t necessarily pay top dollar for it. If you are looking for ways to add value to your home, stick to practical and cost effective expansions.
Expensive Flooring Upgrades
Replacing your flooring with exotic hardwood or high end tiles can give new life to your space, but there’s a good chance you won’t recoup the full cost of the project. Most buyers can’t tell the difference between mid range and premium materials, and they would rather have something that is durable and attractive over too fancy.
Outdoor Kitchens
Outdoor kitchens with grills, refrigerators and sinks might seem like the ultimate for entertaining, but it’s a pricey proposition that doesn’t always pay off. The upgrades are location dependent, buyers in the warm climates are much more appreciative than buyers in colder regions. It’s not a must have for most people even then.
Too Much Personalization
Buyers are alienated by custom designs that reflect your tastes, such as colorful tile backsplashes, unusual paint colors, or themed rooms. It’s your home and naturally you want it to reflect your style, but remember that neutral designs generally appeal more to a wider audience.
Lavish Lighting Fixtures
Just because chandeliers and custom light installations are pretty doesn’t mean they have any impact on a home’s value. What most buyers are concerned with, when it comes to lighting, is natural light, and the brightness of the space more than the price tag of the fixtures.
Disclaimer: This list is solely the author’s opinion based on research and publicly available information.
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