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Home Improvements That Increase Home Value (2026)
Which Home Improvements Actually Increase Your Home’s Value and How to Pay for Them
You’re standing in your driveway on a May afternoon, looking at the house, mentally adding up everything you want to fix. New garage door. Updated kitchen. Maybe a bathroom refresh. The list is real. So is the question underneath it: does spending this money actually pay off?
Here’s the honest answer. Some home improvements that increase home value pay back more than they cost. Some barely move the needle. And a few popular projects, the ones that feel like a great idea, return less than 30 cents on the dollar. Knowing the difference before you call a contractor can save you a lot of money and a lot of frustration.
Let’s walk through what the numbers actually show, what it means for your equity, and how to fund the work without draining your savings account.
What You Need to Know
- Exterior projects almost always outperform interior overhauls on resale ROI
- Minor kitchen updates beat major renovations on return, consistently
- A higher appraised value means more equity, and more equity means more options for future financing
- Renovation loan programs let you finance the work without a separate personal loan
- HELOC rates are worth verifying before you commit
Want to run the numbers on your home before you start? We’re happy to look at your situation before you do anything else.
Which Home Improvements That Increase Home Value Give You the Best Return?
Not all projects are created equal. Here’s what the 2026 data shows.
Garage door replacement is the single highest-ROI exterior project right now. According to the 2026 Cost vs. Value Report, a new garage door can recoup up to 180% to 195% of its cost at resale. That’s not a typo. A relatively modest investment in an updated door changes the entire face of the house, and buyers notice it immediately.
Entry door replacement comes in at roughly 100% to 115% return. Curb appeal is doing a lot of heavy lifting here. When buyers pull up to a home, what they see in the first ten seconds shapes everything that follows.
Stone veneer siding returns 140% to 160%. It’s exterior-facing, durable, and signals quality to both buyers and appraisers.
Minor kitchen updates are where a lot of homeowners get this wrong. A full gut renovation rarely returns what you put in. But targeted updates: new cabinet fronts, updated countertops, better fixtures, fresh paint, can make a real difference. NAR buyer data shows updated kitchens were a deciding factor for about a third of buyers. Minor remodels recoup better than major overhauls almost every time.
Bathroom renovations with updated fixtures and finishes can recoup up to 74% of costs. Not 100%, but meaningful, especially if the bathroom is the one thing keeping a buyer from making an offer.
Small repairs often return more than they cost. Paint, power washing, replacing dated light fixtures, fixing what’s broken. These aren’t glamorous, but appraisers and buyers both respond to a home that feels well cared for.
Which Projects Don’t Add as Much Value as You’d Think?
Major additions and high-end primary suite renovations typically return only 24 to 36% of their cost. That’s not a reason to skip them if you’re staying in the house and you’ll genuinely enjoy the space. But if you’re doing it to get the money back at sale, the math usually doesn’t work.
Here’s why. An appraiser’s hands are tied by comparable sales. If your neighborhood has homes selling in the $350,000 to $400,000 range, a $100,000 kitchen remodel doesn’t push your appraisal to $450,000. The comps set the ceiling. A $400,000 house with a stunning kitchen is still a $400,000 house in that market.
The average homeowner spends $15,000 to $20,000 on improvements before listing. Many recoup less than 60 cents on every dollar. Project selection matters more than most people realize.
What Do Home Improvements Actually Do to Your Mortgage?
This is the piece most people don’t think about. They focus on what renovations do to sale price. But what they do to your appraised value right now is just as important.
When your home appraises higher, your equity position improves. More equity means more options. It changes what you can borrow against the house, whether that’s a future refinance, a line of credit, or just the confidence of knowing where you stand.
But not every improvement shows up dollar-for-dollar on an appraisal. I’ve seen clients put real money into a home and come away surprised at how little moved the needle with the appraiser. Condition matters. Comparables matter. Location matters. The appraiser isn’t guessing. They’re anchored to what similar homes in your area have actually sold for.
The takeaway: choose projects that improve condition and curb appeal first. Those move appraisals. Luxury finishes in a mid-range neighborhood typically don’t.
How Do You Pay for Home Improvements Without Wiping Out Your Savings?
Americans are expected to spend a record $524 billion on home remodeling in early 2026. A lot of that money comes out of savings, and a lot of homeowners don’t realize there are smarter ways to fund the work.
Here are three options worth knowing about.
Option 1: FHA 203k Rehab Loan
This is one loan that covers the purchase or refinance of the home plus the cost of renovations. Instead of draining your savings or layering on a personal loan with a high interest rate, the renovation gets folded into the mortgage. One loan. One payment. If you’re buying a home that needs work, or you own a home you want to improve without touching your cash reserves, this is worth a real conversation. You can read more about how it works on our FHA 203k Rehab Loan page.
Option 2: Cash-Out Refinance
If you’ve built up equity, a cash-out refinance lets you access some of it to fund improvements. With 30-year rates near 6.9% as of late April 2026, this doesn’t automatically make sense for every homeowner. If your current rate is already in that range or higher, the numbers might work. If you refinanced a few years ago at a lower rate, replacing that loan just to access equity is worth thinking through carefully. We can run the comparison for you. More detail on our cash-out refinance page.
Option 3: HELOC
A home equity line of credit lets you borrow against your equity as needed, which makes it a good fit for projects with an uncertain scope or a longer timeline. The rate is variable, and current HELOC rates have moved. I’d rather give you a verified number in conversation than a ballpark that may not be accurate by the time you read this.
Questions We Hear a Lot
Does a finished basement add value to my home? It can, but the return varies a lot by market. In Minnesota, finished square footage matters, but only if the finish quality matches the rest of the home. An appraiser compares your home to what else is selling nearby. A finished basement in a neighborhood where other homes have them helps. In a neighborhood where they don’t, the return is harder to predict.
Should I renovate before selling or price the home as-is? Depends on the project. Small cosmetic fixes almost always make sense. Major renovations before a sale rarely recoup what you spend. A better use of your time might be pricing accurately and letting the buyer decide what they want to change. I’ve seen sellers leave money on the table both ways. If you’re not sure, let’s talk through it before you start pulling permits.
Can I use a renovation loan if I already own my home? Yes. The FHA 203k works for existing homeowners through a refinance, not just buyers. If your home needs significant work and you’d rather not tap savings, it’s worth knowing this option exists before you assume you have to pay out of pocket.
What if my renovation makes my home the nicest on the block? That’s where the comparable sales ceiling matters most. Appraisers value your home in relation to what similar homes around it have sold for. The nicest house in the neighborhood is rarely the highest appraised one. Build what you’ll love, but go in with clear eyes about what it does to your number.
Spring is a good time to think about all of this. The weather is right, contractors are booking up, and the summer projects you’ve been putting off start to feel real. But before you pull permits or call for estimates, it’s worth knowing which projects actually move the needle on your value and equity, and how to fund them without making your financial picture harder.
We can run the numbers. That’s what we do. The first step is just a conversation.
Apply Online if you want to get your financing picture in place before the project starts.
Book a Call with Ken if you’d rather talk through your options first. No pressure. Just clarity.
Written by Ken Graczak, NMLS #184394 | CFR Mortgage | Bloomington, MN
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