Is a Kitchen Remodel Worth It? A Quick Look at Cost vs. Value

The heart of the home.

Thinking about updating your kitchen? It's often called the heart of the home, and a well-planned remodel can dramatically improve both its function and beauty. It’s your home’s heart health. Before you start picking out new countertops, it's wise to consider the cost of a kitchen remodel in relation to your home's value. While a new kitchen can certainly enhance a home's appeal, the return on investment (ROI) can vary.

How Much Should You Budget for a Kitchen Remodel?

Experts often suggest budgeting between 5% and 15% of your home's total value for a kitchen remodel. The specific percentage can depend on several key factors:

• Scope of the remodel: A minor kitchen refresh, replacing cabinet fronts and appliances, will cost less than a full-scale overhaul with structural changes.

• Quality of materials and appliances: Choosing high-end custom cabinetry and professional-grade appliances will push costs toward the higher end of the spectrum.

• Location: Remodeling costs can vary significantly by region and even within a metropolitan area, with some places being more expensive than others.

• Personal preferences: Your personal aesthetic choices, from a simple, neutral design to a highly customized look, will impact the final cost.

Understanding Return on Investment (ROI)

While a kitchen remodel can enhance your home's value, the ROI can also vary. A recent study, the "2024 Cost vs. Value Report," provides some helpful data on this topic.

• Minor kitchen remodels may offer a higher ROI. According to the national averages in the 2024 report, a midrange minor kitchen remodel could recoup an average of 96.1% of its value upon resale in the Atlanta, GA, area. The project for this remodel involves updating a 200-square-foot kitchen by replacing cabinet fronts, countertops, and appliances with new energy-efficient models.  This average price may assume that the homeowner handles their general contracting as well.

• Major kitchen remodels (midrange and upscale) may have a lower ROI. The national average for a midrange quality major kitchen remodel shows a cost recouped of 42.2%. This type of project involves a complete update of an outmoded 200-square-foot kitchen, including new semi-custom wood cabinets, a 3x5-foot island, laminate countertops, and energy-efficient appliances. For an upscale quality major kitchen remodel, the national average for cost recouped is 33.9%. An upscale remodel of a 200-square-foot kitchen could include custom white cabinets with sliding shelves, stone countertops, a tile backsplash, and commercial-grade appliances.  The assumption for a major remodel is that the homeowner has hired a Licensed Contractor (GC, RBC, RBLC)  to plan, schedule, oversee, and handle any additional tasks associated with the remodel.

Ultimately, the best approach is to carefully assess your budget and consider your goals for the renovation. Are you remodeling for your enjoyment or primarily for resale value? To get a clear picture of the potential ROI in your specific area, it's always a good idea to consult with local real estate professionals or appraisers.