Central Pennsylvania’s property market continues to run red hot, which means it’s a great time to be a homeowner here in Lancaster. Even if you aren’t ready to sell just yet, strong housing prices mean every dollar spent on your home goes a little bit further.
Here’s how to build equity in your home by making some smart choices about home improvements.
How to Build Home Equity With Home Improvements
Home improvements are a great way to get more out of your biggest investment — your house. With property prices still on the rise throughout Lancaster County, money spent on improvements that your family can enjoy today will be worth more tomorrow as the value of your home — and your stake in it — increases.
That said, improvements still need to be paid for and some upgrades offer more equity bang for your buck than others. That’s important, especially if you are going to dip into savings or borrow money to make your improvements.
Let’s take a look at some sure-fire winners, steady bets, and learn more about the way home improvements can help you nail down a bigger stake in your home’s equity. We’ll also look at some options that might not build as much equity as you think.
Home Improvements to Build Home Equity: Sure-Fire Winners
Money spent on your house is nearly always money well spent, but not everyone is ready to plunk down $30,000 or more on a new kitchen. Here are six cheaper and much simpler projects that offer significantly better returns on investment.
|Project||Average Cost||Recoverable Value|
|2||Refinish hardwood floors||$2,500||100%|
|4||Add stone veneer to house front||$11,100||91%|
|4||New wood floors||$5,500||91%|
|5||New garage door||$2,300||87%|
Home Improvements to Build Home Equity: Steady Bets
These projects offer a reliable return on investment in terms of increased equity in your home. Importantly, they are also sensible options that will yield real benefits for you and your family as you continue to live in your home.
Basement conversion — While the cost will depend on the size of your home, an average conversion runs at $18,400 and adds up to 75% of that to the value of your house.
Improved floor plan — While estimates vary, removing one or more walls to add usable space to your home can add significant appeal to your home if done right.
Upgrade your laundry room — Improving access to your washer and dryer for as little as $8,000 creates a major draw for growing families and will make things easier for you too.
Replace your HVAC — If your heating and AC are getting old, replacing them now will improve efficiency for you and add value to your home when it comes time to sell.
Home Improvements to Build Home Equity: Easy Wins
Not ready to break the piggy bank to pay for a major upgrade? Here are some practical weekend winners that will spruce up your home today while giving your ever-increasing equity stake an added boost.
Paint — Paint is cheap and a splash of new color can transform any space. Whether you do a room or your entire interior, you’ll add value for yourself and appeal to buyers with every coat.
Molding, fixtures, and lighting — Small inexpensive details from door handles to curtains can make a seemingly ordinary space special.
Overhaul cabinets — Replacing the doors, handles, or hardware on cabinets in your kitchen or bathroom is a great way to make a big difference to these rooms for very little cost.
New windows — Improve your energy bill while adding curb appeal. Working consistently to update older windows will add incrementally to your home equity.
Home Improvements to Build Home Equity: Think Twice
Not all projects are home equity slam dunks. Here are some projects that might seem tempting today but could end up costing you in the end.
Removing bedrooms — Sure, knocking down a wall to increase light, or add usable space makes sense, but the number of bedrooms in your home is a key determinant of its value.
In-ground pools — What may be an attractive feature for owners, many buyers might see your dream pool as a safety hazard or a maintenance nightmare.
Luxury upgrades — One person’s luxury is another person’s styling gaffe. Buyers might not be willing to pay for fine finishes they see as an unnecessary add-on.
Garage conversions — Unless you live in a densely populated city where living space is at a premium, garage conversions are usually a bad idea. Your buyer is more likely to want to use the garage to park a car or for storage.
Put Your Home’s Equity To Work
Central Pennsylvania’s rolling farmlands, appealing suburbs, and vibrant small cities continue to attract people to our area, meaning house prices will continue to increase. As a homeowner, you can maximize your return on investment in your property with a home equity loan or home equity line of credit,
Belco Community Credit Union offers our members flexibility and loan terms that fit your needs, including:
- Low fixed rates
- Home equity loan terms up to 180 months
- Home loans up to 100% of your home’s value, and
- Generous terms and no prepayment penalties on our home equity lines of credit.
Click below to learn how Belco’s home equity loan products can help you make the most of the home you are in.