What should you be remodeling in 2011?

Although the general economic picture remains uncertain, the remodeling industry seems to have turned a corner.  According to the Leading Indicator of Remodeling Activity (LIRA) released by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University, homeowner improvement spending is expected to be up at a double-digit pace at an annual rate through the first half of 2011.

Kermit Baker, the director of the Remodeling Futures Program at the Joint Center for Housing Studies feels that remodeling contractors are feeling much more positive about the outlook for home improvement projects because of low financing costs and a glut of foreclosed homes coming back on the market and in need of renovation. The $44,073 question (the average cost of a home renovation in 2005, according to CNN) is what home remodeling project will get the biggest bang for your buck in 2011. Cost vs. value data from Remodeling Magazine,  a leading industry publication, indicated that in 2008-2009, the biggest ticket price for a remodeling project was a two story addition cost the most on average at $146,538; it only recouped 71% of its value when the property was resold. The data indicates that a wood deck addition was the project that recouped the most, 82% of the original $10,601 investment.

If you were taking a decision purely on the numbers a deck remodeling project would win. However a recent survey conducted by General Electric, indicates that a kitchen remodel might be a better investment. More homeowners (60%) are eating out less and spending more time dining at home - and more than half of them are actually cooking six to ten meals per week for friends and family. This means that it’s a safe bet to invest in this living space if you want quick results. In the Chicago area, minor kitchen remodels cost on average $21,246 and almost 80% of the investment was recouped! Homeowners take different decisions for different reasons, so depending on your budget; you’ll have lots of choices as to which living space will get you the highest returns in 2011.