The Wright Sisters Group | Union Realty Brokerage Inc. - The Beaches, Leslieville, Riverdale and East York Real Estate Specialists – Your East End Toronto Real Estate Team
03 February 2016

Return on your renovation dollars

There are many factors that affect the return you can get when you upgrade. Where you live in the city, neighborhood, socioeconomic status, economic conditions such as interest rates and jobs in the area, perceived value, fashion, weather (very hot, very cold), number of kids in area, age of your home.

Sometimes the answer is easy. Renovations such as painting almost always give good return, in particular, if the paint is a bit tired or colors are dated.

On the reverse side some renovations and home improvements offer bad return from the point of view of getting your money back when selling. In this category we find upgrades that are valuable to the current owners but are not attractive to all potential buyers. (IF the right buyer is found however return can be very good).

Very strongly coloured tiles in bathrooms or kitchens, swimming pools, wine cellars, dance floors, expensive very specific built-in entertainment centers, outside hot tubs, unusually high quality materials, fixtures and finishes, or elaborate basement bars, are all examples of home improvements that will not appeal to everyone and will not payback as well.

Another factor in how well a renovation or upgrade will payback is the "emotional appeal" of the renovation. Although a new roof might be a more solid investment, it's hard for a buyer to get emotionally involved with it. A nice new clean room with a fresh coat of paint goes straight to the "feel good" area of people's brains and the return is a much larger percentage. It's a bit illogical but emotional appeal is a big factor.

Enough talk, how much are we talking about?

All agree that a home that is in good shape has modern amenities and is attractive and has curb appeal, sells better than one that looks dated and tired, but what is the actual return on investment for renovations and improvements?

Probably the most reliable source of information comes from a survey of several hundred appraisers conducted in 2008 by the Appraisal Institute of Canada.

Most common renovations being done:

  • Energy efficient upgrades such as new heating systems, windows and insulation
  • Ground floor home office
  • Hardwood flooring upgrade in kitchen
  • Whirlpool bath separate from shower
  • Built-in kitchen appliances
  • Addition of kitchen cooking island
  • Non-neutral interior paint colors
  • Spa style shower systems.
  • Home theatre room
  • Skylights

Return on investment for renovations and upgrades according to the Appraisal Institute of Canada.

Expected Return (Range of Return)

Poor Return on Investment

  • Skylight installation (0% - 25%)
  • Swimming pool (0% - 25%)
  • Whirlpool Tub installation (0% - 50%)
  • Interlocking Brick walkways (25% - 50%)
  • Home Theatre (25% - 50%)
  • Building a Fence (25% - 50%)
  • Paving with asphalt (25% - 50%)
  • Landscaping (25% - 50%)

Medium Return on Investment

  • Central Air installation (25% - 75%)
  • Roof Shingle Replacement (25% - 75%)
  • Deck Building (25% - 75%)
  • Paving with Concrete (25% - 75%)
  • Basement Renovation (50% - 75%)
  • Construct A Garage (50% - 75%)
  • Recreation Room (50% - 75%)
  • Fireplace installation (50% - 75%)
  • Flooring upgrade (50% - 75%)
  • Heating System upgrade (50% - 75%)
  • Windows and Door replacement (50% - 75%)
  • Garage Construction (50% - 75%)

High Return on Investment

  • Bathroom Renovation (75% - 100%)
  • Kitchen Renovation (75% - 100%)
  • Exterior Paint (50% - 100%)
  • Interior Paint (50% - 100%)

The Appraisal Institute of Canada has a useful worksheet that calculates potential return according to the above range. If you are planning to upgrade have a look.

Return on Investment on upgrades according to The National Association of the Remodeling Industry

Not surprisingly they are more optimistic than the Appraisers' (conservative) return estimates, but the order of return remains much the same.



Add a Bathroom

Add a Fireplace

Kitchen Renovation (minor)

Kitchen Renovation (major)

Bathroom Renovation

Add a Skylight

New Siding

Add Insulation


New Roof


Greenhouse Addition

Replace Windows /Doors

Add a Swimming Pool

Average Cost
















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