As a home owner, one of your primary concerns should be building equity on your home. Equity is the value of the property minus the obligations against it, usually your mortgage. So in order to increase this value you can do two things: pay the mortgage capital or perform home improvements to build equity. Increase equity is one of the easiest paths to wealth and economic independence, as a home is for many the biggest and most stable investment they will ever own.
Most home improvements will add value to the home and as such build some equity, but some offer a higher return on investment than others. For example, remodelling your kitchen will often increase the value of your home much more than if you install a swimming pool, as potential buyers value more things they need than nice to have items. When considering home improvements to build equity, you need to achieve the right balance between the money you spend and the increase in value and desirability achieved.
Among the most popular home improvements to build equity, remodelling your kitchen and bathroom is probably the number one, particularly if the property is not recently built. In order to get the most value for your money, inexpensive improvements that make your kitchen look more beautiful and modern are often preferable. Low maintenance and long lasting items, such as granite countertops, can offer good value despite the initial investment provided they are on par with the average value of the property and the properties in the neighbourhood. For example, unless your property is a luxury home or on a very good and upcoming neighbourhood, fitting the most expensive granite slab countertops may be a cost you will never be able to recover, but choosing more affordable natural or engineering stone can be a good option.
Another type of home improvements to build equity that have become very popular are those that make your home more energy efficient. From double or triple glazed windows to eco-friendly appliances or even improving the loft’s insulation, making your home more green will not only save you money in your energy bills but will help you achieve a higher price if you decide to sell. In some cases, you can also enjoy tax credits for work that makes your home more energy-efficient, increasing the ROI of this kind of home improvements. You may also want to look into increasing the usable surface of your home at the same time, by fitting the loft as an extra room while installing the new insulation.