Extending a home’s living space outdoors is a growing trend for homeowners, and potential buyers are interested in features such as cozy fire pits, inviting patios and pleasant landscaping. But which home projects have the largest payoff in terms of adding value?
In late summer and fall 2016, the National Association of Realtors and National Association of Landscape Professionals surveyed landscape professionals about the cost of 10 common outdoor projects. They then asked real estate professionals to quantify how much appeal each project would likely have for buyers and estimate how much money homeowners could expect to recover on these costs if they sold the home. Find the full report here.
Pro tip: If you want the biggest bang for your buck, go small. The highest returns on investment were from sowing grass seed across the lawn and undertaking a lawn care program that included fertilizing and weed control. The big projects such as fire pits and new pools ranked high on the personal enjoyment scale but had a return on investment of 60 percent — or less.
The projects are listed below in the order of their appeal to potential buyers:
Standard lawn care program
The most appealing project on the list is perhaps the simplest and cheapest: a nice, green lawn. A standard lawn care program — six applications of fertilizer and weed control on 5,000 square feet of lawn — was estimated to cost $330 when done by a landscape professional. Real estate professionals estimated the recovered cost at about $1,000, a 303 percent return on investment.
According to the NAR survey, 75 percent of real estate professionals have suggested sellers upgrade their lawn before attempting to sell; 14 percent said a lawn upgrade had recently helped close a home sale.
Real estate professionals ranked an overall landscape upgrade as the next most-appealing project to buyers. This project entailed installing a 3-foot-wide, 30-foot-long natural flagstone front walkway with two stone planters 6 feet long and 2 feet wide, five flowering shrubs and one deciduous 15-foot tree.
This project was more costly: an estimated $4,750 to have it professionally done. Real estate professionals estimated the recovered cost at $5,000, a return on investment of 105 percent. However, the project carried a high “Joy” score of 9.8, close to the top ranking of 10. The Joy score was calculated using more than 4,000 responses to a survey done on homeownership site HouseLogic.com. Consumers gave information about their last remodeling project, and the Joy score was calculated by combining the share of respondents who were happy or satisfied, then dividing that number by 10 to create a ranking between 1 and 10. Higher scores indicated greater joy from the project, according to NAR.
A new patio, another common outdoor project, has a high Joy score of 9.6, and real estate professionals estimate about 102 percent of its value is recovered from the project when the house sells. For this study, the landscape professionals’ cost estimate for the project was $6,400, with the estimated recovered cost of $6,525.
But perhaps where the project pays off most is in personal enjoyment. Of the homeowners surveyed, 82 percent said they have a greater desire to be home since completing the project, 74 percent have an increased sense of enjoyment when they are home and 85 percent reported feeling a major sense of accomplishment when they think about the project.
New wood deck
A new wood deck ranks similarly, with a 9.7 Joy score and an estimated value of return of 106 percent. A deck, typically elevated above the ground, costs a bit more than a patio, which is usually at ground level. Landscape professionals estimated the cost of building a new wood deck at $9,450, with an estimated recovered cost of about $10,000.
About 10 percent of real estate professionals suggested sellers add a new wood deck before attempting to sell, the report states, and about 4 percent of Realtors said the project helped them close a house deal.
Upgrading the softscape — the plantings around a property — is a frequent recommendation for homeowners looking to sell. According to the study, 26 percent of real estate professionals have suggested that sellers improve their softscape before putting their home on the market. Four percent said a softscape upgrade had recently helped them sell a home.
For the purposes of this study, a softscape upgrade included planting five trees, 25 shrubs, 60 perennials, natural edging and boulder accents, all estimated at $7,000. Real estate professionals estimated the recovered cost at $7,000 also, making the estimated recovered value 100 percent.
Sodding the lawn is another smart investment for would-be sellers. According to the study, 17 percent of real estate professionals suggested homeowners sod their lawn before attempting to sell, and 2 percent said the project had helped close a recent house deal.
Installing 1,000 square feet of sod was estimated to cost $700, with an estimated recovered cost of $1,000, a recovered value of 143 percent.
Even less costly, and perhaps more effective, was seeding the lawn. According to the study, 22 percent of real estate professionals had suggested potential sellers seed their lawns, with 2 percent reporting that a seeded lawn had recently helped them close the deal on a house.
The cost to seed a lawn is minimal — $120 to seed 1,000 square feet of lawn, with an estimated recovered cost of $500, a 417 percent return on investment.
Outdoor fire pit
Fire pits have become a trendy gathering spot, but this project didn’t get high marks from real estate professionals. Only 3 percent suggested sellers add a fire pit before putting their house on the market, and just 1 percent said the project had recently helped close a sale.
The estimated project cost was $4,500 to install a dry, stacked natural stone kit, gas burner and a 10-foot-diameter flagstone patio. The estimated recovered cost was $3,500, giving the project an estimated 78 percent recovered value.
More complex than a fire pit, an outdoor fireplace with veneered masonry stone, a gas starter for wood-burning, a chimney, two wood boxes and a wood mantle, also ranked low on the list of appealing outdoor projects.
Landscape professionals estimated the project cost at $13,300; real estate professionals calculated the recovered cost at $8,000, which would give the project only a 60 percent recovered value. One percent of real estate professionals suggested the project to prospective sellers, and 1 percent of real estate professionals reported a new outdoor fireplace recently helped close a sale.
The study showed a new pool to be a major investment with only about a 50 percent return. Landscape professionals estimated the cost of installing a new pool at $50,000, while real estate professionals estimated the recovered cost at about half that, around $25,000. Only 1 percent of real estate professionals suggested sellers add a pool before selling their property. Two percent said a new pool had recently helped them close a deal.
Although the return on investment was not high for a new pool, the Joy score for this project was the maximum of 10. Ninety-five percent of consumers who had installed a new pool said they have a greater desire to be home since completing it, 80 percent reported an increased sense of enjoyment at home and 90 percent reported feeling a major sense of accomplishment when they think about the project.