If you are looking to invest in your home and build equity, you may want to consider investing while home prices and mortgage rates are rising. Home prices and mortgage rates, while still historically low, have been steadily climbing in recent years. This increase in price means that homeowners are racking up record amounts of home equity.
Improvements in high-use, high-traffic rooms, such as kitchen and bathroom upgrades, have the most impact on your home value. Remodeling a kitchen could give you one of the biggest returns on your investment, but even minor remodels can cost more than $20,000! The bright side is that homeowners can expect to recoup around 81 percent of their investment, according to Remodeling Magazine’s Cost Versus Value study.
Updating your bathroom is another way that you can add value to your home. Midrange improvements to a bathroom — like new mirrors, sinks and toilets — can increase your home’s value. Extensive renovations, like bathroom additions, are good investments since most homebuyers will value the convenience of an extra bathroom.
Bigger isn’t necessarily better in today’s market, but strategically increasing the amount of living space can help boost your home value. Knocking down a nonstructural wall and creating an open concept interior will create the illusion of a bigger space. Neutral-colored walls, cabinets or furniture can also brighten up the space and give it a bigger feel.
If a home’s exterior is well maintained, including the front yard and backyard, it reflects well on the care that the homeowners put into it. When it comes to curb appeal, even upscale renovations can be considered bargains in the long run. According to a study by Remodeling Magazine, new garage doors retain 98 percent of their value at resale and deck additions recoup an average of 73 percent of their value.
Energy-efficient renovations start paying for themselves soon after they’re added. Replacing windows with energy-efficient panels recoup 74 percent of their value at resale, as the study above suggests. Additionally, the U.S. Department of Energy reports that windows certified by Energy Star can save homeowners up to $465 a year on utility bills. Even strategically planting native trees can reduce energy costs by as much as 50 percent while raising the value of your home!
When trying to decide how to finance these renovations, consider how much you want to borrow. It can be hard to calculate the best home equity loan on your own.
Contact the GECU home loan professionals to help you navigate through the process and make your house a home by calling 778.9221 toll-free at 1.800.772.4328 or by visiting any GECU location.
*All loans subject to credit qualification and approval. The property must be located in the United States, within a 150-mile radius of El Paso County, to include Hudspeth County. Certain fees and conditions apply. Equal Housing Opportunity Lender. Learn how to become a member at gecu.com