Not all home improvement projects are created equal. Some renovations may cost a lot but not add significant value to your home. This list goes in the opposite direction: Here are some inexpensive home improvement projects that will not only increase your enjoyment of your home, but will also increase the home’s value.
- High quality ceiling fans: In a recent National Association of Home Builders survey, ceiling fans ranked No. 1 as the most-wanted decorative item. If your ceiling fans are outdated, replace them with something in the $400 range—it’ll make a big difference when it’s time to sell.
- Trees: Mature trees can be worth as much as $10,000 toward the value of your home. Trees also protect your home from the elements and prevent erosion.
- Energy efficiency: Buyers are increasingly interested in saving energy, so any efficiency update is worthwhile. Switching from a wood to gas fireplace is a great start.
- Outdoor lighting: Exterior lighting is great for highlighting the accents of your home, and you can typically expect a 50 percent return on investment.
- Molding: You can finish a room with crown molding or railing for as little as $1.50 per foot if you take a DIY approach, and it’s extremely desirable among prospective buyers.
As with any home improvement project you should consult your personal qualified Realtor®. As a professional I can help you determine what is popular in the local, regional, and national market. I can also tell you what buyers are looking for when purchasing a home. I can give you options for minor and major remodeling projects and offer you choices that will have the highest and best return on investment for your geographical area.
Consult with an experienced professional – Contact me today! 413-301-4614
In early January a sharp decline in interest rates, coupled with buzzing announcements to reductions on popular federally-insured home loans, resulted in both purchase and refinance volume at their highest in six years, according to a CNBC report.
After rates dropped in the first full week of the year, total home loan applications almost doubled in the week following. By mid-month, purchase applications were two percent higher than the same time last year, and demand for refinances was at its highest in eight months. According to a Wall Street Journal report, rates on the popular 30 year fixed home loan were at their lowest since May 2013.
Big Housing Announcements
The housing industry was already the talk of the town after the President announced cuts to mortgage insurance premiums on new government-insured Federal Housing Administration (FHA) loans. The reductions will result in more affordable monthly housing payments and provide new opportunities for as many as 2 million borrowers over the next three years.
In other mortgage insurance news, legislation was again passed which makes any payments on mortgage insurance premiums in 2014 tax deductible.
If the housing market continues on its strong start to 2015, we can be sure to see strong and sustained income growth and a significant move upward in the industry!
The Bottom Line
Continued low rates and higher demand for popular first-timer home loans may drive up housing activity. This could be just the time you’ve been waiting for to buy or sell a home.
If you have any questions regarding housing please feel free to contact me. Now is a great time to explore your next real estate transaction.
Tori Denton, REALTOR®
Tax Credit Rewards Homeowners Who Make Home Energy Improvements
If you installed energy-efficient home improvements in 2014, you may be eligible for a $500 tax credit. Among the home improvements that might qualify for the tax credit:
- HVAC systems
- Water Heaters
- Biomass stoves
Tax credits are valuable because they offset the tax you owe, dollar for dollar. For example, if you owed $10,000 in taxes, a $500 tax credit would reduce what you owe to $9,500.
The Residential Energy Tax Credit had expired at the end of 2013, but just last week, Congress renewed it through 2014. That means you may be able to claim the tax credit when you file your 2014 federal taxes. Congress did not extend the tax credit through 2015.
Warning: It may take a while for the IRS to update its website with information about the renewal, and to post a 2014 version of Form 5695, which you’ll use to claim the credit.
Check the Energy Star website to see if the specific energy-efficiency home improvements you made qualify for the credit. Give that site a few weeks to get updated with the latest information, as well.
The Fine Print
In general, you’ll get a 10 percent tax credit for installing energy-efficiency improvements. But, your tax credit is capped for some items. For example, you can’t claim more than $200 for windows, and a new air conditioner will earn you no more than a $300 tax credit.
There’s also a lifetime cap of $500, so if you took the tax credit in prior years, you have to subtract the credit you claimed from $500. For example, if you took $400 in 2013, you can only take the remaining $100 in 2014.
The cost to install your energy-efficiency improvements may, or may not, be included. For example, window installation is included, but insulation installation is not.
This tax credit applies only to your main principal residence.
This is great news for home owners. Check with your accountant to see if your improvements qualify.