Home improvement is practically an American pastime, with millions of homeowners completing projects each year. While renovations will generally improve your quality of life, many don’t actually provide a financial return.
“In most cases, only home projects that add additional functionality or livable square footage add to the home’s value,” says David Steckel, home expert at home services marketplace Thumbtack.
The exceptions are kitchen and bathroom upgrades, as well as extensive enhancements to the exterior such as a new roof, windows or landscaping because these projects can elevate the home’s feel.
To identify projects that can increase your property value when you sell—or at least save you money while you live there—we spoke to home improvement experts and sifted through return-on-investment data. Below, a look at five popular home improvements and tips to make sure they pay off.
Do solar panels increase home value?
Interest in solar has been growing thanks to the Inflation Reduction Act, which provides homeowners with a 30% green tax credit for solar energy installations.
A rooftop-solar system that meets a typical household’s energy needs costs $15,300 on average including installation, according to proelectrification nonprofit Rewiring America. That translates to about a $4,600 credit.
Under the right conditions, adding solar can also significantly reduce your monthly utility costs. Plus, data also suggests solar panels increase a home’s value somewhat when it comes time to sell.
According to a 2019 Zillow study, homes with solar systems sold for 4.1% more on average than comparable homes without solar power. The sale premium varied by market, from 5.4% in New York to just 2.7% in Riverside, Calif., but was present in every market Zillow analyzed.
Before moving forward, however, make sure your home is a good fit for solar. One tool is Google Project Sunroof, which