The annual Cost vs. Value Report, commissioned by Remodeling Magazine, measures the return on various remodeling investments. According to the recently-released 2006 report, the return is not as great as it once was.
It’s no surprise to me but the report indicated while remodel prices continue to rise the return on that investment is declining and is now at 2002 levels. For example, a major kitchen remodel in our area of the country (which includes, Mississippi, Alabama, Tennessee and Kentucky) will run about $51,304. You can expect to recoup only $40,041 or 78.1% of the cost.
These figures are in keeping with the correction in the real estate sales market. Over the last few years everything associated with real estate has skyrocketed. As I have noted before, the market could not continue to climb at the same rate as the last few years. We are going thru a correction right now and returning to a more normal market and it is going to affect all aspected of real estate. So don’t panic! Dated homes still need to be upgraded. If not for resale then for your own personal enjoyment.
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