Home improvement is a broad term that can refer to any renovation, addition or upgrade to a residence. Home improvements can be done for a variety of reasons, including increasing the home’s value, making it more comfortable to live in, or fixing issues that may exist.
Home renovations can be costly and require professional assistance. Before undertaking any project, be sure to consult with a licensed contractor and get a written estimate that includes an itemized cost breakdown. The contractor should also specify the timeline for work to be completed and a payment schedule, including an initial deposit. A deposit cannot exceed 1/3 of the contract price, and the homeowner must withhold final payment until all work is complete and any required inspections or certificates of occupancy have been obtained.
It’s important to remember that not all home improvements will increase a home’s value. In fact, some projects can even decrease a home’s value by creating problems that will turn off potential buyers. For example, a homeowner who invests in a high-end master suite may not be able to recoup the investment if they sell their home within a few years because young families will likely find it unsuitable for their needs.
Despite the challenges, homeowners are still spending on home improvement projects. According to Houzz’s 2022 U.S. Home Study, the median spending for home improvements increased to $19,000 in 2022 from $15,000. However, spending varies by ownership status. For instance, new home buyers invested more in their homes than long-term owners in 2017.