Adding value with home renovations
A good investment in a renovation should increase the value of your home by at least 50% of what you spent. Before you plan any improvements, understand what does – and doesn’t – add value to your home.
5 renovations that usually add value
| Type of improvement | Average recovery rate* |
| 1. New or improved kitchens and bathrooms | 75-100% |
| 2. Low-cost improvements – Painting, new wallpaper, new rugs | 50-100% |
| 3. New windows or doors | 50-100% |
| 4. Basement renovation | 50-75% |
| 5. Investments in more efficient use of energy, especially if you are eligible for government rebate programs | 60% |
*The percentage of your cost that you may recover when you sell your home
Source: AppraisalAppraisal An evaluation of what your home or other property is worth today. Most often done by someone who is an expert or is certified by an organization or the government. The Appraisal Institute of Canada is one organization that designates individuals.+ read full definition Institute of Canada
3 upgrades that usually don’t add much value
| Type of improvement | Average recovery rate* |
| 1. Costly landscaping | 25-50% |
| 2. Spa style shower systems | 36% |
| 3. Swimming pool | 0-25% |
*The percentage of your cost that you may recover when you sell your home
Source: Appraisal Institute of Canada
If many homes are being torn down in your area, it may not be worth it to do costly renovations. Buyers who are going to tear down your house will have no interest in the building — just in the land.
Don’t forget the HST
When you’re budgeting for home renovations, don’t forget to take into accountAccount An agreement you make with a financial institution to handle your money. You can set up an account for depositing and withdrawing, earning interest, borrowing, investing, etc.+ read full definition the HST you’ll have to pay on them.
Take action
Find information on a wide range of renovation topics from the Canada Mortgage and Housing Corporation (CMHC).
Key point
You probably won’t get your money back from:
- costly landscaping
- spa style shower systems
- swimming pools