Home Improvements on your property that Pays

Some luxurious but costly improvements that are commonly viewed as value-builders are actually losers when it's time to sell.

The real dogs in terms of payback at resale are luxury items that are highly individual to the owner's taste. Things like Jacuzzis and tennis courts are very low on the payback scale. Saunas are a complete waste of money as are Koi ponds and water features.

The most definite way to recoup costs

Kitchen improvements are perhaps the most definite way to recoup your revamping costs, depending on the nature of the changes and assuming that you don't spend too much relative to the value of the home.

In the "Cost vs. Value Report," an annual survey of remodelling costs payback at resale, experts say that even a minor kitchen renovation exercise can return as much as 102 percent of costs at resale. Moreover, a renovated kitchen can make a house sell faster.

Attitudes about kitchens have undergone enormous changes in the last 30 years, so it's not surprising that renovating a kitchen has the best return. Kitchens are now much more integral to the house and the whole family is often involved in food preparation. Any changes that make it lighter, brighter and a more useful room add a lot to a home's value.

Good move to add a bathroom

Another good move is to add a bathroom. On average, this will bring back over 90 percent percent of the costs. Viewed in the right context, this is actually a bountiful return on investment. For one thing, you get a valuable intangible — the use of the improvements in the years that you remain in the house.

You can't compare renovating a home to financial investments, like unit trusts. This is disposable income we're talking about. People add a bathroom rather than going on a cruise or buying a new car. There may be better investments out there, but your new kitchen won't lose half its value the minute you make your first meal in it, the way a new car will lose a huge chunk of its value the minute you drive it off the showroom floor