How to Increase Home Value

Most homeowners believe their homes will continue to increase in value over the next 10 years. That assumption isn’t baseless: Real estate has reliably outpaced inflation over the last 50 years and remains one of the most powerful tools to create and pass on generational wealth. 

While certain factors, like your home’s location and market conditions, are out of your control, keeping up with repairs and upgrading the property over time is a smart move to preserve asset value. 

From efficiency upgrades to adding square footage to a kitchen remodel, below you’ll find tips for how to increase home value so that when you’re ready to sell, you get the most from your investment. 

Why Should You Try to Increase Your Home Value? 

Increasing your home value can benefit you in many ways. It can provide a higher return on your real estate investment when you decide to sell, help you secure better refinancing options and improve your quality of living. One of the most common regrets homeowners have after a remodel is that they didn’t start sooner so they could enjoy the home renovations. 

Renovations or improvements to increase your home’s value can help you build and protect equity in the home. There are many renovations that more than pay off long term, from kitchen remodels to updating lighting or taking out unnecessary walls. But there are also simple, low-cost renovations like landscaping or staging that can improve the property’s curb appeal to potential homebuyers. These pay off when you’re ready to sell, leading to more interested buyers and a higher sale price. 

How to Increase Your Home Value in 14 Ways

If you’re ready to increase your home’s value, here are 14 options to consider. This is a starting point to get you thinking about what upgrades are most needed in your home. You could also choose just one on this list or work your way through the list as relevant to your property. 

1. Renovate the Kitchen

Updating the kitchen with modern features and design can significantly increase the value of a home. Whether you need a full kitchen renovation or just a few upgrades depends on your home, target market and comparable properties. 

Many homeowners opt for new marble or quartz countertops to increase resale value. Likewise, adding a new backsplash or painting the cupboards can upgrade it. 

2. Improve Curb Appeal

Curb appeal is a personal judgment of how charming or attractive the home’s exterior appears. This can include landscaping, an entry area, a walkway and the appearance when you first enter the home. Adding flowers and improving landscaping is a simple way to improve curb appeal immediately. Consider repainting or residing the house, painting the front porch or front door and entryway upgrades. When the home makes a good first impression, it can increase resale value.

3. Upgrade Bathrooms

Renovating bathrooms with modern fixtures and finishes can add value and appeal to potential homebuyers. Old, outdated bathtubs, poor lighting or bright pink tiled walls can all give the impression that the home hasn’t been updated in a long time. Consider neutral colors, clean lines and new fixtures to upgrade bathrooms. You can search Pinterest or other decor sites for inspiration and work with local professionals. You also can add a bathroom to increase resale value. 

4. Install Energy-Efficient Features

Adding energy-efficient windows, insulation and appliances can attract homebuyers with long-term energy savings while increasing the home’s value. Consider installing solar panels, a heat pump or other energy-saving options to further boost the home’s value. Even better? Many energy-efficient features have federal, state or local incentives so you can save more on installation.

5. Replace Flooring

Replacing old or worn-out flooring with new, high-quality materials can enhance a home’s overall appeal and value. Old, dirty carpet is especially unattractive to potential buyers. Consider replacing it with new carpet, tiles, wood or laminate floors to upgrade the appeal and potential resale value. 

6. Enhance Storage Options

Adding built-in cabinets, shelves or closets can increase the functionality and value of a home. Walk-in closets in the master bedroom are a particularly sought-after feature. Consider increasing or upgrading closet space and storage options to increase functionality and long-term value. 

7. Upgrade Lighting

Installing updated lighting fixtures can improve a home’s ambiance and overall appeal. Good lighting creates a clean, fresh appearance, while poor lighting can make a home feel old or outdated. Like curb appeal, good lighting throughout the house can increase resale value. 

8. Consider Home Staging

Home staging can help potential buyers envision living in the space, leading to a higher perceived value and offers. You can hire a professional home stager or research home staging online and do it yourself. 

There are also tricks of the real estate trade, like diffusing certain scents — apple, cinnamon and vanilla are common — in the home when showing it to prospective buyers to activate a subconscious sense of comfort in the home. 

9. Convert Unused Spaces

Transforming unused areas, such as an attic or garage, into functional living spaces can add value and additional square footage to a home. Consider creating an apartment above the garage or an office in the attic. Some homeowners convert the garage into a separate guest house, gym or other functional space to add additional value.  

10. Install Smart Home Technology

Integrating smart home features, such as automated lighting, security systems and thermostats, can attract tech-savvy buyers and increase the value of a home. These features can help protect the home while increasing the comfort of the inhabitants. 

11. Create an Outdoor Living Space 

Adding a deck, patio or outdoor kitchen can extend a home’s usable space and increase its value. Consider staging the outdoor living area with modern furniture and decorations and integrating outdoor areas with landscaping to create a unique additional living space. 

12. Upgrade the HVAC System 

Installing a new, energy-efficient heating and cooling system can improve comfort and appeal to buyers. Consider adding a heat pump or an energy-star-rated HVAC system. Either way, you could qualify for federal and state rebates on the new system. 

13. Improve Home Security

Adding security features, such as cameras, alarms and secure entry systems, can increase the value of a home by providing peace of mind to potential buyers. Consider an entry door camera or cameras on the property’s perimeter to increase property value. Depending on local standards and the neighborhood’s safety, you could also hire a professional security company to advise you on the best installations. 

14. Create a Home Office or Study Space

In today’s remote work environment, having a dedicated home office or study area can be highly desirable and add value to a home. Whether you convert a bedroom, add a home office above the garage or renovate the attic, this additional feature, furnished or staged to look like an office, can increase resale value. 

How to Fund Renovation Projects to Increase the Value of Your Home

Renovation projects can be costly. While landscaping costs could be more affordable, as soon as you start replacing major home systems, like HVAC, redoing bathrooms or kitchens, the costs can add up quickly. Here are some options to fund a renovation project. 

Cash

Paying for home improvements using your own savings or cash is the simplest solution. That means you need sufficient savings to protect your emergency fund, and you’ll have to be prepared to cover the difference if costs run over. 

Credit Cards

Using credit cards to pay for home improvements can be a way to earn extra points or rewards as long as you’re able to pay off the credit card before it begins charging interest. You can pay for home improvements with credit cards either by using an existing credit card or applying for new credit cards. 

Some new credit cards have promotional offers, such as a 0% annual percentage rate (APR) for 12 to 18 months, which gives you time to pay off the debt before interest accumulates. If the new credit card has a high minimum spend to reach certain rewards, a home improvement project can be the perfect time to get those extra points. 

Personal Loan

Another option is borrowing money from a bank or financial institution to fund home improvements. A personal loan is usually a fixed interest rate and repaid over time. You can get personal loans for as little as $1,000 to $30,000 or more. While interest rates on personal loans are lower than on credit cards, you will pay for the convenience of borrowing. Carefully check interest rates, fees and terms to find an option that fits your needs.

Home Equity Loan

Borrowing against the equity in your home is another option for homeowners who have built up equity. A home equity loan is typically repaid with a fixed interest rate over a fixed period. It’s one of the most popular options for homeowners considering renovations.

Home Equity Line of Credit (HELOC) 

A HELOC is similar to a home equity loan, but instead of receiving a lump sum, you can access a line of credit from which you can draw as needed. This allows you to borrow funds at key stages throughout the renovation. With a HELOC, you only pay interest on the amount you borrow, allowing you to control debt and receive a customized amount for your home improvement project.

Refinancing

If you choose to refinance, you could replace your existing mortgage with a new one that has a higher loan amount. The additional funds can be used for home improvements. Before pursuing this option, look at the total costs of refinancing, including underwriting fees and closing costs to determine whether this option makes sense for you financially.

Government Programs

Taking advantage of government-sponsored programs that offer financial assistance or loans specifically for home improvements, such as HUD home improvement loan programs allows more homeowners to renovate or repair their properties. The U.S. Department of Housing and Urban Development, (HUD) offers rehabilitation and repair and property improvement loans through HUD-approved lenders to help you fix your home. 

Completing Your Renovation Projects

You have many options to improve your home’s value, but not all offer a good return on investment (ROI). Completing your renovation projects can be a way to personalize your home’s space and continuously upgrade to meet your family’s needs. On the other hand, if you plan to sell, look at comparable properties to find the home renovations that will provide the greatest short-term return. Learn more about real estate market analysis and how to evaluate how much your home is worth here.  

Frequently Asked Questions