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Adding value to your home is not as costly as you think.

According to The Appraisal Institute, a national association of real estate appraisers, home improvements that err on cost-effective tend to be the most worthwhile—in fact, studies show that the highest returns are often on lower-cost renovations.

“The latest research shows that home improvements with a relatively low cost are most likely to generate a positive cost-to-value ratio,” said Jim Amorin, president of The Appraisal Institute, in a statement. “Spending big dollars on major renovations doesn’t necessarily equate to a dollar-for-dollar return. In short, cost doesn’t necessarily equal value.”

No matter the scale of the project, homeowners should take into account their neighborhood before breaking ground, the Institute cautions.

“Projects that move a home well beyond community norms are typically not worth the cost when the owner sells the property,” Amorin said.

Homeowners with questions about their specific project can consult the Institute’s Remodeling & Rehabbing brochure, a free resource on home improvement, or a real estate appraiser.

Source: The Appraisal Institute

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