Tips to Homeowners

Question: I am planning a major remodeling project on my home, and am interested to know what my recovery costs on this project would be if I decide to sell the home within the next year or two.

Answer: Earlier this year, Remodeling World magazine made a study of recovery costs for various remodeling projects on a short-term basis. It must be remembered that this was based on an average, 17-year-old home, that these are national averages and do not necessarily apply to all types of remodeling in California. However, it is probably a good rule of thumb. Here are their figures for recovery costs:

--Room addition, 55% to 60%.

--Adding a fireplace, 133%.

--Major kitchen remodeling, 60% to 80%.

--Minor kitchen remodeling, 80% to 90%.

--Remodeling a bathroom, 40% to 50%.

--Adding a full bath, 100% to 130%.

--Changing windows and doors, 50% to 70%.

--Adding insulation, 70% to 85%.

--Adding a solar greenhouse, 90% to 100%.

--Adding a swimming pool, 25% to 30% in colder climates and 65% to 80% in warmer climates.

When you consider the recovery range of a new automobile over a one- or two-year period, you can see that normally home improvements are a good buy. Also, you must remember that most home improvements are done for personal enjoyment and better life styles, and that if a home is held for four or five years before it is resold after major remodeling has been done, the inflationary situation has more than forgiven the investment.

Doing home improvement work for the purpose of reselling a home must be carefully considered as a result of these findings. This is why I have stressed that when you remodel for resale, the cosmetic effect is the most important aspect of the project unless there are serious deficiencies in the existing structure, in which case the home improvement work itself, if not of a major nature, is done to make the home more saleable.

However, I think the important part of these findings is that home improvement is basically a good investment but should be approached on the basis of an increase in the standard of living and life style of the homeowners.

Fontaine is president of the Western Regional Master Builders Assn. and a director of the American Building Contractors Assn. He will answer questions concerning home improvements. Phone 213/653-4084 or write him at 6404 Wilshire Blvd., Suite 850, Los Angeles 90048-5510.

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