Return on Investment Projects

As an experienced General Contractor with over 20 years in construction, my professional recommendations encompass a range of home improvement projects that not only enhance your living space but also provide the best return on investment, as highlighted in the National Association of Realtors (NAR) report.

One of the most lucrative projects is a master bathroom remodel. Upgrading fixtures, adding modern amenities, and creating a spa-like atmosphere can significantly increase your home's value. Homebuyers often prioritize a luxurious master bathroom, making this a wise investment choice.

Another high-impact project is finishing the basement. Converting an underutilized space into a functional living area, such as a guest suite, entertainment room, or home office, appeals to buyers seeking additional square footage. A well-designed finished basement can add substantial value to your property.

Consider adding an Accessory Dwelling Unit (ADU) to your property. These self-contained units, like a guesthouse or in-law suite, provide extra living space and can be rented out for additional income. ADUs are increasingly popular with homeowners and investors alike, offering a promising return on investment.

Expanding your home's square footage through a room addition or popping the top and adding an additional story can also be advantageous. Extra living space, whether it's a new bedroom, living room, or office, contributes to the overall value and appeal of your home.

If your home has an attic that is currently unused, finishing the attic space can be an excellent investment. Converting it into a functional living area, like a bedroom or playroom, adds usable square footage and enhances the property's desirability for potential buyers.

Lastly, for those seeking a comprehensive transformation, a whole-house remodel can be a smart choice. Upgrading the kitchen and bathrooms, replacing outdated systems, improving energy efficiency, and enhancing overall aesthetics can give your home a fresh, modern appeal and increase its market value.

Before embarking on any home improvement project, it's essential to research local market trends and consult with a real estate agent to understand what potential buyers are seeking in your area. By aligning your home improvement choices with the preferences of prospective buyers and leveraging the NAR report's insights, you can make informed decisions that not only enhance your living space but also maximize the return on your investment when it's time to sell your home.

Value-Add Projects Like Kitchen and Baths Yield Big ROI

When a local multifamily community was feeling the pressure of Denver's highly competitive rental market, they turned to Stonebridge Builders for help. They needed to consider upgrades not only to address deferred maintenance issues and outdated amenities, but also to justify rent increases to be consistent with local demand.   In densely populated urban areas with many options for apartment living, property owners need to set themselves apart from the competition. For many, this means rehabilitation projects to bring value where others don't. By industry standards, a successful renovation project should generate rent increases between 10-30%from interior improvements, and renovations to kitchens and baths tend to generate the greatest ROI.     

A great example of this strategy is Home Properties, headquartered in Rochester, NY. The company owns over 43,000 units in 121 properties primarily located in the Mid-Atlantic and Northeast. The company strategy is to acquire assets that most other developers would not be interested in. They're not looking for the newest, most attractive or luxury communities. The assets they acquire are in need of rehabilitation. The company knows that by rehabbing and renovating properties that are "a little beaten up and a little run-down" they can achieve substantial rent increases, which ultimately drives revenue. This strategy has yielded an 11.4 percent average annual total return over the past 10 years, and a 5- year compounded return of 11.7 percent.

Deferred maintenance is certainly an area of focus in multifamily renovation, however the most significant investments are made in upgrading kitchens and baths.   In Denver, Stonebridge Builders helped the local company to exercise this strategy and achieve the same results. Kitchens were upgraded with updated cabinetry and counter tops, state of the art appliances and both pendant and recessed  lighting to create a brighter look and feel. Baths were also remodeled with upgraded materials and lighting, which justified rent increases, encouraged retention and decreased vacancies.  

If your multifamily property could use a little TLC, and you're considering a value-add project, look to Stonebridge Builders for a consultation and ultimately for a seamless and successful process.