Real Estate agents and contractors like to talk about upgrading and remodeling your home to increase its value. Get an estimate from any remodeling contractor on just about any project, and you are likely to hear about the wonderful value the project will add to your home. Just like the sales pitch to promote swapping out your heating and cooling system for a new, more efficient system. When you do a cost analysis across the board you’ll find that it can take 10 or 20 years to recover the cost to replace the system with the savings in energy costs. As long as you know the story before you spend the money, it’s fine.
Let’s look at a new deck as an example. We’ll take the average 16 foot by 20 foot composite deck built in Virginia, using all mid-range materials and design aspects for construction. A simple design, simple railings, with pressure treated framing materials and composite decking and rails. The average price from a contractor would be about $16,000, while the project would add an average of about $9,200 to the value of your home. Don’t get too hung up on the numbers here. These are only averages for illustration purposes and regardless of how accurate they are or are not, (though they come from a compilation of data from over 23 government agency building departments) the point they make is irrefutable. In this example, the deck cost $6,800 more than it added in home value, and each year that passes will see that value continue to depreciate. Again the actual numbers are not that important here. The point being made is that the money you pay to the contractor for his labor, overhead and profit do not get added to the value of your home. While the deck may increase the value of your home, it decreases your net worth. For the sake of this article, we’re leaving out the considerations for enjoyment of use, as well as maintenance and upkeep expenses.
There is a way to add value to your home, and increase your net worth at the same time, if you know how. Do it yourself. Sounds simple, no? What if you do not have the knowledge, skills or tools to build a new deck? There are home improvement coaching services available if you know where to look.
Back to the 16 foot by 20 foot deck. The materials cost about $4,000 total, plans, permits and other miscellaneous costs included. If you did all of the work yourself, the end result would be the same. That is, you would have a nice deck to enjoy, and it would add the same $9,200 in value to your home as the one the contractor would build-it is the same deck. Only this one cost you about $4,000, and gave you an estimated $5,200 in increased NET WORTH. If you’ve never built a deck before, or whatever the project is, it will take some time to learn “hot to”, and probably cost a bit more as you fix some of the mistakes you are bound to make along the way. If you can spend the next few weekends, and some evenings during the week working on the project, you’ll get it done sooner than you think! Look for a retired contractor, or a remodeling coach, to show you how to do it. The fees you’ll pay them may bring the cost up a bit, but you’ll still have a few thousand dollars more to your net worth, and learn a sill that you can use over and over again.