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.
According to JLC's Cost vs Value, most home owners in the Chicago North Shore area in 2023 will spend an average of $58,586 on “midrange” bathroom additions. (Midrange bathroom additions are based on 6-by-8-foot spaces.) The average ROI for this investment comes in at 34.7%.
Now let’s look at ROI numbers for “upscale” bathroom additions. (Upscale bathroom additions are based on 100-square-foot areas.) In 2023, the average cost for upscale bathroom additions in Chicago, IL, is currently at $107,477. Once completed, the ROI of this project comes in at 32.6%.
The figures cited here are according to the JLC's Cost vs Value
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.