The ROI of Home Improvements
home improvement Matt Carson May 19, 2025
home improvement Matt Carson May 19, 2025
If that kitchen needs new countertops, your roof leaks or you want to swap out an old tub for a new shower, the cost might seem like a major deterrent.
But if you’re a homeowner with equity in your property, a Home Equity Line of Credit (HELOC) could be just the answer. A HELOC allows you to borrow funds based on the value of your home and it gives you plenty of time to pay it back.
Ready to explore what you can do with a HELOC?
A HELOC could offer flexibility when you need funds for projects and unlike a home equity loan, which provides a lump-sum upfront, a HELOC allows you to access cash during a set period.
Called the draw period, it typically lasts five to 10 years. You can use your HELOC funds for home improvement, giving you more freedom than a traditional second mortgage or personal loan.
Using the ROI as a benchmark, you can examine the numbers with a critical eye to help you finalize and prioritize your home improvement goals. Often, a look at the numbers can help you determine whether a particular project is a critical must-have or whether it can wait its turn in favor of other remodels.
To help you out, we've compiled a list of some of the most sought-after remodels in the market today, along with their ROI percentages and commentary on how those numbers have changed from 2023.
When it comes time for you to dive into your remodel’s to-do list, we're here to help you find the financing solution that makes sense for you, your family and your unique circumstances. So, if you are ready to get going on home improvements of practically any scope from the minor to the extensive, we recommend speaking to one of our Loan Officers. We have many different types of loan options and home equity products — like a Home Equity Line of Credit — to help make your homeowning vision a reality. With that in mind, let's dive in.
It's no secret that home improvements can be expensive and invasive. The latter is especially the case if you work from home. Depending on the intensity and complexity of the remodel in question, you might find that you need to relocate the family while upgrades are underway. It can likewise take some time after the remodel is over to get some sense of normalcy back.
We mention these factors not to put you off but to make sure that you factor these aspects into your thinking. After all, whether home improvements add value to your home and whether they are worth it to you can be two very different things.
With that in mind, there are two things you should ponder before embarking on your home's journey of renewal. For each project, consider the following:
Ultimately, whether a particular remodel is worth the cost and interruption is highly subjective. There's nothing wrong with a home makeover simply because you want it or because it brings you joy. The list we've prepared here with the ROI numbers is simply to give you a framework so that you can get an at-a-glance view into how much popular home makeovers can add, on average, to the value of your home.
Return on investment (ROI) for home improvements is measured by how much of the cost of a particular makeover is recouped once the house is sold relative to how much it costs overall. The ROI numbers presented here are national averages. These can vary from region to region depending on a number of factors, so bear that in mind as you read, and categorize them as estimations.
So, let's take a look at Remodeling magazine's yearly release of their Cost vs. Value report. 1 With that as our guide, here are the relative ROI rates of some of the most popular home improvements:
Our first item on this list is one that proved quite popular last year with a 103.5% ROI. That number fell to 66.1% in 2024, however. While there are any number of factors that could affect why converting a home's HVAC system from fossil fuels to electric could have fallen off so much in a year, this does prove one of the biggest downward changes from 2023.
Something to note, however, is that such a home improvement’s ROI is never more relevant than in the year that the house is sold. So, if you just completed this type of upgrade but don't think you'll sell your house for a few more years, don't worry. Historically, this is one of the most reliable and sound improvements.
In sharp contrast to the HVAC conversion, garage door replacement has skyrocketed in value since last year. In 2023, this upgrade already boasted an impressive rate of 102.7% value, meaning that the upgrade effectively paid for itself and then some. Now in 2024, the ROI is an incredible 193.9%! Considering that this type of upgrade has the lowest costs on this list, it makes it an ideal starting place for homeowners beginning their suite of home improvements.
Another upgrade that had more than a 100% ROI last year, a manufactured stone veneer on the exterior of a home has continued to rise in popularity in a big way. From 102.3% in 2023, its ROI increased to 153.2%. Considering the relatively low price overall, this is another way that homeowners can dramatically spruce up the appearance of their home at first glance while increasing the property value. It also goes to show the enduring power of curb appeal to potential buyers.
So far, we've covered upgrades that have undergone radical changes, both up and down. All three kitchen remodel types, however, do show differences from 2023, though perhaps not to as great of a degree.
Overall, all three increased slightly in price. (That's pretty common across the board when you factor in general inflation and economic factors.) The ROI ticked up for all three as well. The midrange minor remodel was the clear winner of the three with its ROI going up to 96.1%, a 10.4% increase from last year. Both the midrange major remodel and the upscale remodel did increase by around 7% from last year, but their overall ROI numbers are far lower for the effort and resources involved at 49.5% and 38%, respectively.
Still, the kitchen is likely the first thing a potential buyer might notice in a house without furniture, and the advantages of having a fully-modernized and upgraded kitchen while you're living in the house can seldom be overstated.
As we stated earlier, curb appeal is a tried-and-true approach to hook your buyer before they even set foot in the house itself. A stone veneer is one way to increase that perceived value, but siding is another way to beautify and protect the exterior of the home. Not surprisingly, both types of siding have solid ROI numbers behind them. Fiber cement was largely unchanged, with only a 0.01% drop in ROI from last year.
Vinyl, while still viable, did see its own ROI drop by 14.5% to its current position at 80.2%. This would suggest that the increased durability and fire-resistance of fiber cement over vinyl siding are more attractive options to owners looking to preserve their homes against the elements.
Next, we look at a category that is very close in both average price and ROI to what they were a year ago. Both types of window replacement increased slightly in price (again, not a surprise). Where they differ, however, is that the ROI for vinyl window replacements dropped by 1.4% to settle in at 67.1%. On the other hand, wood window replacements increased by 1.7% to 62.9%. Not a severe change either way, though it is interesting to note how housing accessories do seem to be trending away from vinyl.
Decks have long been an in-demand home feature across the country, particularly in the warmer months when summer get-togethers and cookouts are the norm. It seems that decks of both the wood and composite varieties have seen a jump in their ROI numbers. Though changing very little in price, their return-on-investment numbers have increased from 50.2% to 82.9% for wood and 39.8% to 68.2% for composite. While these numbers may not be as high as other upgrade types, their sharp increase would seem to tell the tale that the demand for decking is on the rise.
When it comes to remodeling your bathroom, there's definitely some good news and bad news. The good news is that — overall — all three scales of bathroom remodel have remained close to their price tags from last year while increasing in ROI. The downside is simply that the more upscale the remodel is, the lower the ROI numbers become. This was the case in 2023 as well. The upscale bathroom remodel clocks in at the lowest of the three at 45.1%, though that number is up from 36.7% previously.
Adding or overhauling the space of the primary suite of your home can definitely be an extra draw for would-be homebuyers. Whether that takes the form of adding a new bedroom, installing a gas-powered fireplace with its own chimney, rearranging the internal configuration of your home or all of the above, you're adding features that could help your home sell quickly.
In the spirit of caveat emptor (Latin for "let the buyer beware") however, the high price tag of such a monumental undertaking may not favor a return on the kind of money it takes to make such a change. In both categories, the ROI percentage did increase, but we hasten to add that the ROI tends to be low relative to the cost. The upscale category, for example, has the lowest ROI of any on this list at just 23.9%, but also has the highest price of any entry here as well. So, if you plan to make such a change to your home, be prepared for it to only give back a third or quarter of what you put into it.
ROI may not be the end-all, be-all deciding factor for you.
Some renovations may be necessary, such as to accommodate the addition of a new family member, whether a baby or an elderly relative.
A Home Equity Line of Credit can be a smart way to tap into your home’s value when you need extra funds, but it’s important to borrow wisely.
A HELOC gives you access to money on an as-needed basis, often with a lower interest rate than a credit card or personal loan.
If you're ready to put your home equity to work, OriginPoint’s HELOC options make it easy to get started with competitive rates, flexible terms and a seamless application process.
1 © 2024 Hanley Wood Media Inc. Complete data from the Remodeling 2024 Cost vs. Value Report can be downloaded free at www.costvsvalue.com .
2 This is a loan product referral and is not offered by OriginPoint.
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