Last week, we spent some time discussing the cost of additions in the Chicago North Shore area. In particular, we looked at these three most common types of home additions: master suites, bathrooms, and decks. But what kind of an ROI can you expect on any of these additions?
While most home owners will renovate to accommodate personal preferences and practical needs, they will also want to know that the expenditure is justified by a bump in the home’s overall value, making it attractive for resale should they elect to move in the future. Today, let’s look at the true ROI of a bathroom addition.
Midrange Bathroom Addition Cost Recoups
According to Remodeling’s Cost vs Value, most home owners in the Chicago North Shore area in 2017 will spend an average of $52,737 on “midrange” bathroom additions. (Midrange bathroom additions are based on 6-by-8-foot spaces.) The average ROI for this investment comes in at 54.1%.
Upscale Bathroom Addition Cost Recoups
Now let’s look at ROI numbers for “upscale” bathroom additions. (Upscale bathroom additions are based on 100-square-foot areas.) In 2017, the average cost for upscale bathroom additions in Chicago, IL, is currently at $94,953. Once completed, the ROI of this project comes in at 54%.
(The figures cited here are according to the Remodeling 2017 Cost vs. Value Reports [www.costvsvalue.com] for the Chicago, IL, area. [© 2017 Hanley Wood Media Inc. Complete data from the Remodeling 2017 Cost vs. Value Reports can be downloaded free at www.costvsvalue.com.])
The Bigger Picture
When evaluating ROI for home remodeling projects, it’s important to consider each project both on its own terms and in terms of its overall impact on the home. According to House Logic, “An additional half bath may increase a home’s total value by 10%, while an additional full bath increases the value by 20%, according to National Association of Home Builder data.”
In other words, overall financial investment analysis is most accurately assessed when individual projects are not isolated but are instead viewed in relation to their impact on the home’s whole worth. So while bathroom additions don’t have a straight 1-to-1 financial payoff, they go a long way toward increasing the home’s overall value and attractiveness to perspective buyers.
Assessing the overall ROI for mid-range versus upscale bathroom additions numbers, it’s safe to say that, to a certain extent, bigger investments generate bigger returns and higher percentage point ROI. So if you’re considering a bathroom addition, don’t be afraid to maximize your project goals to maximize your return dollars.