Updating your kitchen can often lead to a great return on investment when you go to sell your home.

Every time you walk into your tiny, overstuffed master closet, or slip on your dated linoleum floor in the bathroom, or cringe at your yellowing kitchen cabinets, you probably think; “I can not wait until I get this redone!” And for most homeowners, rehabbing and updating a home is all about creating a living space they enjoy and making it more convenient and comfortable.

However, if you are a homeowner who is thinking about updating and upgrading your home because you want to sell it for more money, then there are some very specific things to keep in mind in order to maximize the profitability of your home improvement projects.

In general, Kitchen and Bath improvements offer the best return on investment, usually 80% or higher. Adding rooms or finishing rooms like basements and garages return the least, usually 50% or less. As such, they are not the best types of improvements to make on a home you are planning to sell.

There are a number of factors that will influence just how much a home improvement project will return upon the sale of your home. If the market is hot and homes are not staying on the market for long, home improvements – particularly to kitchens and bathrooms – will return more than if the same house with the same improvements is sold in a “cold” or soft real estate market. If the home improvements you’ve made are typical for the type of home you have and the type of homes found in your neighborhood, they will generally return more than if the improvements are radically different or unique or customized. For example, if you have a home with 1 bathroom in a neighborhood where most homes have 2, than adding a bathroom will generally yield a great return. On the other hand, if you turn a 2-car garage into a media room in a neighborhood where most homes have at least a 2-car garage, you will most likely not see a good return on your money.

The other component to getting a good return on investment is doing as much of the project on your own. You do not want to do anything that requires specialized labor, like electrical work or plumbing (unless you are licensed and trained), but if you are well versed in framing, laying tile, assembling cabinets, etc., you can save money over paying professionals to do the same work and enjoy a better return on investment.

The following list contains information from a number of surveys and estimates on what types of returns you can expect from different home improvement projects. Of course, these are generalized percentages and the actual return you experience will be dependent on the numerous factors that we touched upon above.

• Kitchen remodeling – 90%
• Add a bathroom – 90%
• Bathroom remodeling – 80%
• Install central heating – 90%
• Install central air – 75%
• Add a deck – 70%
• Replace windows – 70%
• Add a room – 55%
• Build a pool – 45%
• Finish a basement – 40%