In the 2025 Outlook for Home Remodeling, Carlos Martin, Director of the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University, explains:
“. . . homeowners are slowly but surely expanding the pace and scope of projects compared to the last couple years.”
The most common projects they’re tackling are replacing water heaters, HVAC units, flooring and energy efficiency. But whether you are thinking about selling this year or in the future, it is smart to think about what is a smart investment for resale.
Every year Remodeling magazine prepares a Cost vs Value Report that compares average costs for 23 remodeling projects with the value those projects retain at resale in 150 U.S. markets.
It should come as no surprise that some improvements yield higher returns than others, and although some projects are fairly consistent year to year, there were some changes last year.
- Average Minneapolis project costs went up 5.2%, not surprising
- Siding saw the biggest increase in cost (20-24%), but also saw the biggest drop in price recouped ( 19-33%)
- Overall change in the amount recouped at time of sale went down 17.4%
- Minneapolis projects recouped an average of 57.7% of the project cost at time of sale
- Nationally it was higher, with 75.1% of project costs were recouped
Nationally, three projects yielded a return over 100% of the amount invested… garage door replacement, steel entry door replacement, and manufactured stone veneer.
In the Minneapolis market, the projects that recouped at least 70% of value were…
- Garage door replacement – 140.1%
- Entry door replacement (steel) – 119.0%
- Manufactured stone veneer – 98.9%%
- Minor kitchen remodel – 80.9%
- Grand entrance (fiberglass) – 72.5%
- Deck addition – 72.3% for wood, 70.5% for composite
- Window replacement – 71.9% for wood, 64.5% for vinyl
- National ROI was 62.9% for wood, with windows one of the few improvements that had a higher return on investment locally than nationally… likely a nod to our winter weather conditions
According to the Cost vs Value Report for 2024 for the Minneapolis market, 23 projects are listed below giving their estimated cost, estimated resale value, and ROI, ordered from highest to lowest Return On Investment. An interesting project addition the last two years is HVAC conversion from gas to electric… yielding a very high return on investment of 96.1% in 2023 but only 49.3% in 2024.
PROJECT – COST – RESALE VALUE – PERCENT RECOUPED
ORDERED FROM HIGHEST TO LOWEST RETURN ON INVESTMENT IN THE MINNEAPOLIS MARKET
- Garage Door Replacement
- Cost: $4,803
- Resale: $6,730
- Recoup: 140.1%
- Entry Door Replacement (steel)
- Cost: $2,409
- Resale: $2,866
- Recoup: 119.0%
- Manufactured Stone Veneer
- Cost: $11,748
- Resale: $11,617
- Recoup: 98.9%
- Minor Kitchen Remodel (midrange)
- Cost: $28,132
- Resale: $22,764
- Recoup: 80.9%
- Grand Entrance (fiberglass)
- Cost: $11,892
- Resale: $8,620
- Recoup: 72.5%
- Deck Addition (wood)
- Cost: $17,438
- Resale: $12,611
- Recoup: 72.3%
- Window Replacement (wood)
- Cost: $25,833
- Resale: $18,569
- Recoup: 71.9%
- Deck Addition (composite)
- Cost: $22,461
- Resale: $15,825
- Recoup: 70.5%
- Window Replacement (vinyl)
- Cost: $23,175
- Resale: $14,956
- Recoup: 64.5%
- Siding Replacement (fiber-cement)
- Cost: $26,515
- Resale: $16,099
- Recoup: 60.7%
- Bath Remodel (midrange)
- Cost: $28,759
- Resale: $16,345
- Recoup: 56.8%
- Siding Replacement (vinyl)
- Cost: $21,285
- Resale: $12,070
- Recoup: 56.7%
- HVAC Conversion (electrification)
- Cost: $20,513
- Resale: $10,113
- Recoup: 49.3%
- Major Kitchen Remodel (midrange)
- Cost: $82,114
- Resale: $33,419
- Recoup: 40.7%
- Roofing Replacement (asphalt shingles)
- Cost: $32,780
- Resale: $12,902
- Recoup: 39.4%
- Roofing Replacement (metal)
- Cost: $52,991
- Resale: $19,049
- Recoup: 35.9%
- Bath Remodel (universal design)
- Cost: $44,942
- Resale: $15,064
- Recoup: 33.5%
- Bathroom Remodel (upscale)
- Cost: $89,950
- Resale: $28,873
- Recoup: 33.2%
- Major Kitchen Remodel (upscale)
- Cost: $161,085
- Resale: $50,165
- Recoup: 31.1%
- Primary Suite Addition (midrange)
- Cost: $174,980
- Resale: $48,776
- Recoup: 27.9%
- Bathroom Addition (midrange)
- Cost: $64,868
- Resale: $17,227
- Recoup: 26.6%
- Bathroom Addition (upscale)
- Cost: $113,165
- Resale: $$29,405
- Recoup: 26.0%
- Primary Suite Addition (upscale)
- Cost: $370,214
- Resale: $66,688
- Recoup: 18.0%
Complete data from the Remodeling Cost vs Value Report for 2024 and other years can be downloaded free. Reports are available nationally, regionally and by city.
Sharlene Hensrud, RE/MAX Results – shensrud@homesmsp.com
