How to use the home improvement roi calculator
- List each project by name, with its total cost.
- Enter the value added to the home by each project. This is your own estimate or an appraiser's opinion, not a published figure.
- Add or remove rows until the list matches your plans. Blank rows are ignored.
- Read the share of cost recovered for each project and for all of them together, the net gain or loss in value and the best project.
Formula
Share recovered = value added / cost x 100
Net = value added - cost
ROI = (value added - cost) / cost x 100
Totals add the costs and the values first, then divide
Totals are not an average of the percentages. A large project counts for more than a small one, which is why the total can differ from the middle of the individual shares.
Three example projects
A kitchen update costs $25,000 and adds $18,000, so 72.0% is recovered. A bathroom refresh costs $9,000 and adds $6,500, or 72.2%. Fresh paint costs $3,000 and adds $3,600, or 120.0%.
Together they cost $37,000 and add $28,100. That is 28,100 / 37,000 = 75.9% recovered, a net change of -$8,900 in value, and an ROI of -24.1% on the spending. Paint is the best project by share recovered, even though the kitchen is much larger.
What "value added" really means
Value added is the difference you expect in the home's sale price because of the work. It is not the cost of the work, and it depends on your market, the quality of the finish and the rest of the house. Ask a local agent or an appraiser for a view, and use a range rather than one number. The amounts in the example are made up to show the arithmetic.
Value is not the only reason to renovate
A project can recover less than it costs and still be worth doing. A new roof or furnace protects the house, and a kitchen you use every day gives you comfort now. The enjoyment you get while you live there is not counted here. Compare the net figure with what the project is worth to you, and be careful when the home will be sold soon.
For budgeting the work use the Renovation Budget Planner, for buy, fix and sell projects use the House Flip Calculator and for the cash from a sale use the Home Sale Proceeds Calculator.
Assumptions and limits
- Cost and value added are in dollars on the same date and do not include financing costs.
- Each project adds the value you enter, independent of the others.
- The sample names and amounts are examples to replace.
- Nothing is uploaded. Calculations run in your browser.
Frequently asked questions
What is a good return on a home improvement?
It depends on your market and on the project. Many projects recover only part of their cost. Treat any national average as a rough guide at best, and use a local agent's opinion for your own house.
Why are the totals different from the average of my percentages?
Totals divide the sum of values by the sum of costs, so large projects weigh more. An average of the percentages would treat a $3,000 project the same as a $25,000 one.
Should I include my own labor?
If you want to know what the project really costs you, include a value for your time. If you want only the cash you spend, leave it out. Be consistent across the projects you compare.
Does this account for the time I will live there?
No. It looks only at value added at sale. If you will live in the home for years, the benefit of using the improvement counts too, and this page does not put a number on it.