The impact of a kitchen renovation on the value of a home can vary depending on several factors, including the extent of the renovation, the local real estate market, and the overall condition of the property. On average, a well-executed kitchen renovation can recoup a significant portion of its cost and add value to the home.
According to Remodeling Magazine's 2021 Cost vs. Value Report, which provides national averages for remodeling projects in the United States, a minor kitchen remodel that includes refacing cabinets, updating countertops, and adding new appliances may recoup around 72.2% of its cost. This means that if you spend $20,000 on a minor kitchen renovation, you might expect to increase your home's value by around $14,440.
A major kitchen remodel, which involves a more extensive renovation, such as replacing cabinets, countertops, flooring, and appliances, might recoup around 62.6% of its cost. So, a $50,000 major kitchen renovation could potentially add approximately $31,300 to the home's value.
It's important to note that these are national averages, and the actual impact on your home's value will depend on factors specific to your location and the quality of the renovation. In some markets with high demand for updated kitchens, the return on investment might be even higher. Conversely, in areas where kitchen renovations are common and home prices are relatively lower, the return on investment may be more modest.
When considering a kitchen renovation for the purpose of increasing home value, it's essential to strike a balance between investing in quality upgrades and not over-improving for the neighborhood. In many cases, a well-designed and updated kitchen can make a home more appealing to potential buyers and help it sell faster, even if the full cost of the renovation is not completely recouped.