Remodeling Your Kitchen - Return on Investment

There is nothing like a nice kitchen to make a home feel warm and wonderful. If you have a crappy kitchen - such as I have - the temptation to gut that sucker and start from scratch is almost overwhelming. Unfortunately, if you want to perform an expensive makeover in your home, the kitchen is the room to choose. I did an estimate on my small kitchen that included new walls, sink, refrigerator, stove, lights, cupboards, dishwasher, counter, flooring, and faucet, and came up with a figure in the $14,000 range. Ouch. I can, of course, do much of the work myself, which should lower the price by several thousand dollars, but still ... this is a lot of money. But then I remembered that the last time we sold a house, the realtor suggested that we remodel the kitchen because the money invested in the remodel would net us three times what we put into it. As it happens, we simply did not have the funding to take on such a monumental task, so we did not do it. Besides - if I am going to go to the inconvenience and expense of remodeling a kitchen, I would kind of like to enjoy it myself for a while. So, we did not do it. The house still sold, but apparently we lost out on about an extra $30,000 by not remodeling the kitchen.

Now that I am itching to remodel my current kitchen, primarily for my own pleasure, I got to thinking about justifying the expense by thinking in terms of recouping my money a couple of times over when it came time to sell. So I took a long look at my crappy kitchen. I then imagined that crappy kitchen made over into a lovely new kitchen. Then I tried to imagine paying an extra $30,000 for the house just because the kitchen was nicer. Would I? Um, no. Not that kind of money. If I were a potential home-buyer, would a new kitchen make-or-break whether or not I bought the house? Possibly, if I were to find a comparable house in every other manner except for the kitchen, but the houses would have to be comparable in price and if I were to make a lovely profit off of my remodeled kitchen, that would not be the case.

In fact, would I even find a 100% return on my investment? Would a new kitchen add $14,000 in value to my home? I really did not think so.

So I did a little research by calling a few realtors. I called five realtors, and four of them told me that I would make a 150% or better return on my money. Realtor number five said that I MIGHT make a 100% return, but probably more like 80-90%. As a side note - if I ever put my house on the market, I will be hiring realtor number five. Big points for not trying to convince me to sink thousands of dollars into a project that will effectively lose money for me, just so that she could sell the house easier.

Then I checked the internet. Sure enough, while there was a site or two that said that the investment would be more than 100%, most sites quoted a 80-90% return on the money.

The moral of this story? If you want to invest money into remodeling your kitchen for your own sake - knock yourself out. Do not do it because you have been told that you will actually make a profit on your investment. That is not likely to happen.