When determining the best home improvements investments to make versus the worst, it's important to keep one thing in mind: return on investment. Some projects will simply cost you more to complete than they'll pay out in equity. Here are some home improvement projects to avoid:
#1 Remodeling your home office.
If your home office is looking shabby, it's important to make some updates to keep it in shape. But don't try to remodel it unless there's a particular problem or extensive and necessary repair. Home office remodels recoup only about 50 percent of the money you spend on them. Go ahead and add some nice elements -- a mahogany desk, more lighting, built-in bookcases -- but don't knock down any walls.
#2 Putting in a pool.
Swimming pools may sound like a good idea, but whether they are depends on where you live. A backyard addition like a pool can be a major hassle for certain homeowners, especially those who live in cooler climates. Then you have to account for filters, pH balancing, heating and any repairs that come into play. Unless you live in a humid, tropical climate, you're probably only going to get about 4-5 months of use out of the pool. You'll maybe recoup 30 percent of your investment, once you account for yearly maintenance costs and the value it adds to your home depending on your location.
#3 Reroofing your home.
If your roof is falling apart or has reached its peak age, it's time to replace it. Reroofing your home is another matter entirely. If you have asphalt shingle roofing, for example, and you want to add a layer of a different shingle type, this comes with a lot of risks. Plus, you'll only recoup an average of 61 percent, depending on the type of shingle you choose. It doesn't really add value to your home if the old roof was working fine in the first place. Focus instead on making necessary repairs to keep your current roof in shape and up to code.
#4 Adding a generator.
Backup generators sound like a good idea if you live in an area with lots of power outages or severe weather. But it doesn't appeal to everyone -- especially potential buyers who see future upkeep costs or an increase in their utility bills. When you sell your home with a backup generator installed, you'll recoup only about 49 percent of the generator, depending on where you live. In fact, if you live in an area in which people rarely install generators, the ROI will probably be less.
#5 Adding a sunroom.
Sunroom additions also sound appealing, but they're not a major selling point for homebuyers. Since it's an addition, it's an expensive endeavor -- between $8,700 and $23,000 -- and it's only useful if you enjoy lots of sunlight or are willing to add air conditioning to the space. On average, homeowners will recoup about 49 percent of their investment with a sunroom addition, and that number can drop dramatically if you live in an area with very little sunlight or extensive winters. You're better off adding a porch or creating a covered garden area in your backyard.
#6 Installing a master bedroom.
While adding a luxurious master bedroom might allow you to create a dream space, it's expensive and also counts an add-on to your home. Master suite additions can cost upwards of $100,000, depending on how and where you add them to your home. While it sounds nice to put in a spa-like bathtub, a minibar, and double-door windows and the like, it's sometimes easier and more cost-effective to make smaller changes to your existing master bedroom. On average, you will only recoup about 53 percent of your master suite investment. Plus, some homeowners may not like the choices you make for an addition, so keep that in mind as well.
#7 Adding on a bathroom.
Akin to the master suite addition, adding another bathroom onto your home can be good or bad, depending on what you do. It costs a lot of money to add another bathroom -- electrical, plumbing, flooring, structural changes -- and these add up quickly. That doesn't even begin to cover the appliances and decor you'll need to make it functional. You could spend anywhere between $20,000 and $40,000 to create a very basic bathroom; a top-of-the-line bathroom will cost upwards of $70,000. At most, you're looking at recouping maybe 59 percent in resale value. That's not a lot for what you're spending, so you're probably better off remodeling or renovating an existing bathroom to fit your needs.
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