By Phil Wengerd
Each year we look forward to seeing REMODELING magazine’s Cost vs. Value Report because it gives us great insights about current trends in our industry. The report contains detailed data that compares the average cost for 36 popular remodeling projects with the value those projects retain at resale in 102 U.S. markets (Cost-Value). Very often the findings mirror trends that we observe with our own growing product mix here at ProVia.
This year’s Cost vs. Value Report provides a mixed bag of results, with some “winning” product categories, and others that have not fared as well. Interestingly, many of the categories where ProVia has product offerings are doing quite well.
These insights provide tips for homeowners who want to ensure that investments in their home translate into good resale value. For dealers, contractors and builders, you’ll find information that can be shared with customers so they can make the wisest home investment decisions. Following are some of our key takeaways from this year’s report.
2015 Cost vs. Value Report: Key Findings
Still #1: The 20-Gauge Steel Entry Door has consistently delivered the best return on investment for resale, holding the top spot in the Mid-range product category since its debut in this report in 2009/2010. This year it’s #1 again, providing a whopping 101.8% Cost-Value. The steel entry door is the only project that, on a national basis, more than pays back its investment (100% +) in the form of a better home resale price. Here at ProVia, our Legacy Steel Entry Doors are a consistent top sales performer.
- 20-Gauge Steel Entry Door.....101.8% Cost-Value
Rising Star: A new project was added this year –manufactured stone veneer. This category zoomed to the top of the 2015 list, grabbing second place overall with a 92.2% Cost-Value. Increased product demand for Heritage Stone by ProVia is a reflection of this trend. In fact we anticipated that the demand for stone would be increasing, and are building a new state-of-the-art stone plant so we can fulfill this growing need.
- Manufactured Stone Veneer.....92.2% Cost-Value
Biggest Gainers: In this year’s report, only five projects saw their cost-value ratios rise. Three ProVia products are in this “biggest gainer” list:
- 20-Gauge Steel Entry Door.....Up 5.4%
- Vinyl Siding..........................Up 3.2%
- Fiberglass Entry Door............Up 1.7%
Solid Investments: 7.3% of the total projects had payoffs topping 100%. The steel entry door job was most common, recouping all its costs and more in 43 markets. Manufactured stone veneer jobs recouped all costs in 27 markets.
Replacement Trumps Remodeling: Replacement jobs—such as door, window, and siding projects—generated a higher return than remodeling projects. This has been the case since at least 2003, but this year the gap widened by 3.8%. Replacement projects showed an average return of 73.2% in this year’s report, just a smidgen below its 73.7% last year, while the cost-value ratio of remodeling projects sank to 60.8% in this year’s report, down from 65.1% last year.
- Replacement Jobs........Average Return = 73.2%
- Remodeling Projects....Average Return = 60.8%
Vinyl Siding Increasing; Fiber-Cement Decreasing: Vinyl siding jobs held their ground better than most job types, perhaps because of a rising perception nationwide of the value of curb appeal. Mid-range vinyl siding replacement jobs were one of only five projects to rise in value, to 80.7% from 78.2%. Interestingly, we saw the cost-value ratio for a fiber-cement replacement job dip to 84.3% from 87.0%.
- Vinyl Siding Replacement........Up 2.5%
- Fiber-Cement Replacement.....Down 2.7%
There’s much more data in the full report, so we encourage you to take a look. What are your thoughts? Do any of these trends reflect what you’re seeing in your local marketplace? Feel free to comment below and share your thoughts, we’d love to hear your feedback.
This article contains excerpts from REMODELING magazine’s 2015 Cost vs. Value Report.