How Much is a Kitchen Renovation Worth When You Sell Your Home?

How much does a kitchen remodel increase home value?

Outdated and short-sighted formulas tout unreliable percentages on what a kitchen renovation is worth and on what percentage of the value of your home you should invest in a kitchen remodeling project. Real Estate websites, home improvement TV shows, and other sources quote returns on Investment, for a kitchen renovation between 30% and 80% depending on the renovation. Sadly, these formulas are overly simplistic and misleading.

Fabuwood kitchen with stacked cabinetry

Knowledgeable kitchen designers know that if the design and material choices are poor, kitchen renovations can actually decrease the value of a home. Conversely, renovations that correct severely poor layouts and are done in styles that appeal to most people can have ROI’s of 200% or more!

Unfortunately, real estate agents and banks undervalue good design. This is evident when a homeowner who corrects severe layout problems sells their home after just hours or days, and often substantially above asking price.

Selling a home quickly and above asking price are NOT good things – they are actually a sign that the home was listed for far below what it was worth. This is the problem with simplistic valuation formulas.

For example, let’s consider a few negative extremes from recent Main Line Kitchen Design customers:

  1. In the last 12 months, two homeowners contacted Main Line Kitchen Design for new kitchens as soon as they closed on newly constructed Toll Brothers homes with (characteristically) poorly designed kitchens. Obviously, these homeowners placed ZERO value on the kitchen designed and supplied by Toll Brothers. How much the Toll Brother’s home could have sold for with a well-designed kitchen we will never know.
  2. Every year, Main Line Kitchen Design is contacted by a number of new home buyers immediately after they purchase a home that the previous owners just finished remodeling. Amateurish and outdated designs used by homeowners who think they are capable of working without professional assistance are often ripped out and the cabinetry either thrown away, donated to charity, or sold on Craig’s List. Again, we will never know how much the home could have sold for with a well-designed kitchen.

The reality is that previous owners in these cases receive no value for their kitchen renovation.

Chris Rossetti kitchen

Conversely, home flippers that dramatically improve a design challenged home routinely sell homes for far above what they paid, plus the cost of renovations.

The most extreme examples we have seen recently are described below:

  1. One Main Line Kitchen Design customer renovated a kitchen, master bath, and did some other minor interior improvements. They also took down a number of trees and underbrush in the overgrown backyard. The changes provide for a dramatic backyard view including a previously blocked lake, from the renovated open concept kitchen and second story deck. The home was originally purchased for $800,000. The renovations totaled $200,000 making their overall investment $1 million. The home sold quickly for close to $1.7 million. It could have probably sold for more since it was on the market for less than 7 days.
  2. Often, stately stone homes built around 1900 have exteriors that would cost a fortune to reproduce today. However, homes built in this era also have tiny kitchens with too many doorways, very low windows, and even staircases that when relocated or removed create the space for amazing kitchens. Opening up the wall between the kitchen and dining room further modernizes the space. While these larger renovations tend to cost close to $100,000, time and time again, these renovated homes sell, almost instantly, for $200,000 – $400,000 more than what was invested in them.

Homeowners who don’t understand the value of quality design updates think that, just because other homes aren’t selling for higher amounts in the neighborhood, making these more extensive renovations won’t pay off. They couldn’t be more wrong! The homeowners who are wise enough to do the more extensive renovations usually aren’t selling their homes – they are living in them, leaving only the homes with poor or outdated designs on the market. 

The best kitchen designers know that good design is ALWAYS undervalued and overlooked.

We also know that designing the best kitchens is impossible for people without extensive experience in these renovations. This is why we ask our customers to be open minded and to consider the designs we recommend first, before we do the design, they think they want. It is more design work for us this way, but customers get better kitchens when they let professionals help them. The final choices are theirs, but homeowners’ decisions are usually quite different when everyone works together.

So, keep an open mind, the result could pay for your renovation several times over.

Wishing our customers, a Happy and Healthy New Year. . . and of course . . .

Bon Appetit!

Paul, Julie, Chris, Ed, John, Lauren, Anna, Tom, Juliet, Camilla, and Mark

Main Line Kitchen Design

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