Top Five Home Remodeling Projects to Maximize ROI in Houston

Houston is a sprawling metropolis with no plans to curtail growth. It’s flourishing job growth has energized the local housing market significantly since the recession and corporations like Exxon Mobil, Geico, and Chevron are busy relocating employees to Houston.

“We are as busy as we’ve ever been,” says Cheri Fama, president of John Daugherty Realtors, which specializes in the luxury market. “People who have discretionary income are willing to invest in real estate and real estate in Houston, Texas is a great investment right now.”

If You are a Homeowner, Now is the Time to Tackle Remodeling Projects for the Biggest Return on Investment

Remodeling Magazine’s annual Cost vs Value Report  compares the average cost for thirty-five popular remodeling projects with the value those projects retain at resale. According to the 2022 and 2023 reports, the following home remodel projects have changed significantly in value recouped. 2104 is seeing a greater national average cost-value ratio than last year, indicating an improvement in real estate resale value, especially in the Houston market.

When embarking on a home improvement project to increase the value of your house, two variables stand out from analyzing 2022 and 2023 reports; appeal to the home buyer by improving the overall look of your house, and capitalizing on the increase of price per square foot value.

1. Entry Door Replacement (Steel)

In 2013 the average return on investment (ROI) was relatively low at 85%. This year, it’s risen dramatically up the list; the average cost is $1,162 and on average you will recoup $1,122. Which makes the 96% return on investment (ROI) and attractive and profitable improvement.

According to the US Department of Energy, exterior doors  “can contribute significantly to air leakage in a home — as well as some heat transfer — if it’s old, not properly installed, and/or not properly air sealed. This can result in energy losses.”

With staggering highs during a typical Texas summer, the last thing you’ll want is an energy-inefficient leaky front door. Steel  doors have an insulating foam material inside making them Energy Efficient. Additionally, steel doors won’t sag over time and are weather resistant, meaning you won’t have to keep replacing them. Best of all, if you choose an Energy Star rated Entry Door, you will qualify for a Federal Tax Credit.

2. Deck Addition

The average cost to build a deck is $9,539.  On average you will recoup $8,334, making this an 87% ROI, an increase from last year’s  77% ROI. The deck addition went up on the list because it utilizes the square footage available without changing any structural plans to the house.

Wooden decks offer the homeowner a place to set up an outdoor grill, patio furniture, a space for hosting BBQs with friends and family. Plus, it makes any house look more attractive, contributing  to a great first impression. It’s less expensive than building an additional room but still allows the homeowner to utilize living space. Covered outdoor patios in Houston get a lot of use; get creative by adding an outdoor kitchen complete with grill and sink, ceiling fans, cooling misters, and surround sound for game night.

Decks are one of the most cost-effective improvements a homeowner can make with a high return.

3. Attic Bedroom

The average cost for an attic bedroom is $49,438, of which you will recoup on average $41,636 with an ROI of 84%. The attic bedroom has gone up on the list from last year’s 75% return in investment value. With the recovery of the housing market, the price per square foot value has also increased. Adding an attic bedroom takes advantage of previously unutilized square footage with minimal structural change.

This is the highest costing remodeling project on this list, but one of the best things you can do to improve your investment.

Adding more insulation to your attic will improve the tax credits you’ll be able to claim. The extra insulation is also a cost benefit to your entire house, especially in the summer. Texas utility companies also offer incentives and rebates for attic insulation in order to meet the goals of increasing energy efficiency in Texas.

4.  Window Replacement

The return on investment for window replacement plummeted sharply 2022, but since then it’s been slowly on the rise. Last year it was 73%, moving up to 79% in 2023. The average cost is around $10,926 with a resale value of $8,662.

It may not seem like a profitable return rate, but there are considerable benefits. Energy efficient windows can keep your house cool and save you a lot on your energy bill, not to mention the Federal Tax Credit you can apply for. Additionally, this can improve on the look of the house, which is a huge plus.

5. Garage Door Replacement

Garage door replacement has gone down on the list from 2023, but has risen on ROI percentage. On average you may spend $1,533, but the return is an average of $1,283 for an ROI of 83%.

An uninsulated steel garage door with ten year warranty is perfect for Houston weather. Steel doors won’t sag or dent easily, even in Texas heat. Investing in a good garage door not only improves your curb appeal, but it can also be energy efficient. Houston is a city with many drivers, most homes purchased in Houston will have a garage, thereby making this a cost-effective and attractive improvement.