The passion for home improvements born during the pandemic, as homebound HGTV fans were inspired to spruce up their surroundings, has only gained steam. In 2022, homeowners spent $472 billion on home improvements and projects spending will reach $485 billion in 2023, according to a recent study from the Joint Center for Housing Studies at Harvard University.
Generous federal tax credits can help defray the cost of energy efficient improvements that could lower your energy costs and add to the value of your home. But before you head for Home Depot or Lowe’s — or contact a contractor —consider which projects will deliver the largest return on your investment.
A good place to start is Remodeling magazine’s 2023 Cost vs. Value Report. The report details the average cost of about two dozen home remodeling projects and the estimated value each project retains if the property is sold. Some of the least expensive projects deliver the biggest payoffs.
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Replacement garage door. Not glamorous, but the project retains more than 90% of its value, according to Remodeling magazine’s analysis. If you want to go for a full exterior facelift, replace the old vinyl siding on your house. The new siding costs an average of $16,348 but retains 94.7% of its value.
New deck. If you need a more welcoming outdoor space, add a deck to your house that can be used as an outdoor home office by day and an entertainment venue at night. A 16-by-20-foot wood deck costs, on average, $17,051, and you’ll probably need furniture, too. Better Homes and Gardens’ Clayton Court 5-Piece Patio Dining Set ($450 from Walmart.com) is a top pick among reviewers at the New York Times’ product-review site Wirecutter. The set, which comes with a table and four chairs, is made of steel and has cushioned seats.
Revamped windows and door. They don’t give you extra space to work or entertain, but new windows and a new front door will keep drafts (and bugs) out. Plus, tightening up doors and windows will help lower your utility bills. To replace 10 vinyl windows, you’ll pay, on average, $20,091, whereas wood windows can run you more than $24,376. Too rich for your budget? Replacing your front door with a steel one costs about $2,214, and you’ll recoup nearly 100.9% of the value.
Updated kitchen. A kitchen remodel that includes a new countertop, sink and faucet, energy-efficient appliances, and fresh paint costs about $26,790, on average, but will add to your home’s resale appeal. Plus, some utility companies offer rebates for buying energy-efficient appliances and equipment or making other improvements.
After your upgrades have been completed, review your homeowners insurance policy to determine whether you need to make any updates. In the event of a disaster, you want to be sure that your improvements are covered. If you are underinsured you risk not receiving the maximum payout if your home is seriously damaged by a fire or natural disaster.
Bang for the buck
Remodeling magazine compared the average cost of home improvement projects with the estimated value they would retain in 101 U.S. housing markets.
| Project | Average Cost | Cost Recouped |
| Garage door replacement | $4,320 | 102.7% |
| Kitchen update | $26,790 | 85.7% |
| New wood deck | $17,051 | 50.2% |
| Window replacement (vinyl) | $20,091 | 68.5% |
| Entry door replacement (steel) | $2,241 | 100.9% |
Disclaimer
Source: www.remodeling.hw.net
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