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In recognition of Home Remodeling Month, the National Association of Home Builders’ Remodelers (www.nahb.org/remodel) is highlighting the financial incentives of remodeling and offering suggestions for consumers on projects that provide the best return on investment, including improvement in energy efficiency.
“Remodeling not only enriches a homeowner’s quality of life, but it can also provide numerous financial rewards,” said NAHB Remodelers Chairman Lonny Rutherford, CGR, CAPS, a professional remodeler from Farmington, N.M. “Smart remodels increase home value and save homeowners money by improving home performance.”
With interest rates at historic lows, homeowners can now move forward with long-delayed projects that help maintain their home’s value by modernizing and adding amenities. Attention to home maintenance adds comfort, enhances home performance and avoids future costly repairs. And there are immediate savings on energy and utility bills after upgrading home efficiency.
“It doesn’t take much effort to increase home values,” he added. “Adding a full bath or renovating the kitchen are great investments, but smaller projects such as replacing siding or adding a deck improve the space and beautify a home.”
According to the experts at NAHB Remodelers, the best return on investment doesn’t always mean spending big:
- Fix drafts for better air flow, or repair the roof to stop leaks. Even simple repairs can drastically improve home performance and protect the structure’s integrity.
- Add the most value for the least cost by replacing siding or adding a small bathroom.
- Expand your home to the outdoors by adding a deck, patio or porch where you can relax or entertain.
'Green' RemodelingRemodelers are more knowledgeable than ever about “green” options, and with energy-efficiency tax credits and new technology, homeowners can maximize the efficiency of their home while minimizing their utility bills. As energy costs rise, consumers can save money by making sure their homes use less energy through increased efficiency.
“Smart green remodeling solutions really make a difference in lightening energy bills,” Rutherford explained. “Just replacing faucets greatly reduces water bills. And installing new windows or sealing air gaps decreases wasted money on heating and air conditioning.”
Homeowners can reduce their utility bills with these simple solutions:
- Toilets, showers and faucets account for 60 percent of water usage in the home, according to the EPA. Replacing these items with more efficient models can save 11,000 gallons of water per year.
- When buying or replacing appliances, choose energy-efficient models. Federal Energy Star-rated appliances are designed to use 10-50 percent less energy and water than standard appliances, and save an average of 30 percent over standard models.
- Install a programmable thermostat to set your heating and cooling equipment to automatically turn on or off to match your schedule and create a comfortable and energy-efficient living environment. These units typically offer savings of 10 to 15 percent and cost $40-$100.
- Old windows are often the weak link in energy efficiency. New window technology yields windows that are three times as efficient, or more.
Remodeling Activity SteadyDuring the first quarter of 2008, remodeling activity remained steady, according to the NAHB’s Remodeling Market Index (RMI). The current market conditions indicator increased to 41.8 from 40.9 in the fourth quarter of 2007, while the future expectations measure showed no change from the previous quarter at 37.9.
The RMI measures remodeler perceptions of market demand for current and future residential remodeling projects. Any number over 50 indicates that the majority of remodelers view the market conditions as improving. The RMI has been running below 50 since the final quarter of 2005.
“The remodeling market continues to show weakness, following the downturn in the overall housing market,” said NAHB Chief Economist David Seiders. “We expect there to be some further erosion in 2008, with a gradual recovery in 2009.”
Nationally, the RMI components for major additions and alterations during the first quarter increased to 44.15 (from 42.28). Minor additions and alterations decreased to 41.57 (from 41.76). Maintenance and repair remodeling work increased to 39.68 in the first quarter (from 38.11). The amount of work committed for the next three months decreased to 29.63 (from 33.15 in the fourth quarter), demonstrating a decline in the backlog of remodeling jobs.
“While remodeling is down nationally, some markets continue to churn with activity,” said Rutherford. “Many remodelers are seeing smaller jobs and have a shorter backlog, but we expect activity to increase because necessary home repairs cannot be postponed for a long time.”
Regionally, current market expectations dropped in the first quarter in the Northeast to 36.4 (from 38.6), and in the South to 42.2 (from 45.0). The Midwest, however, increased to 44.1 (from 41.1) and the West was up slightly to 42.9 (from 42.2).