Does That Newly Built Backyard Oasis Still Add Value in 2021?
August 20, 2021
Last year was a huge year for home improvement projects and many people chose to turn their average backyard into a summer oasis. There were so many home projects going on, it increased by 21% between 2019 and 2020! While people focused on installing decks, patios, and spa-like amenities, they weren’t focused on what the resale value could be - they were just trying to make it through the pandemic with some of their sanity still intact.
So, what does that mean for folks who are trying to sell their homes? Will that effort and money be for nothing, or do these investments actually help toward increasing property value? Let’s take a look at insights from top real estate agents and see what they have to say.
In-ground hot tubs
Swimming pools were in high demand among homeowners and buyers, and the number of pools that were installed in 2020 increased by 200% in just 60 days. However, swimming pools weren’t the only addition folks invested in. Homeowners sprang for in-ground hot tubs to give their yard a luxurious feel.
To get one of these fancy additions, you’re looking at a price tag ranging anywhere from $8,000 to $25,000. As pricey as that is, you aren’t going to recoup all of that money back. Instead, this amenity can fetch between $4,000 to $7,000 - only 42% return on your investment.
Free-standing hot tubs
Homeowners who wanted a more affordable option for a hot tub chose to install a free-standing hot tub. These units typically cost between $2,000 to $6,000 for an entry level hot tub and $4,000 to $8,000 for a mid-grade unit.
When a buyer asks the seller if they would be willing to include the hot tub with the house, they’re looking to pay around $2,000 on top of the asking price. Yet, when it comes down to it, if you spent more than $2,000 for your unit, you’re just barely going to make a profit. If you spent more than that, you may only get 50% of your investment back at the time of sale.
In 2020, homeowners pulled out all the stops to create an outdoor kitchen befitting a grill master. They tossed out their charcoal grills and opted for a built-in grill with plenty of counter space. Some homeowners even went so far as to build a wet bar, cabinets, a sink and appliances like a mini refrigerator or dishwasher!
To build an outdoor kitchen, homeowners could spend as little as $5,500 for a basic setup and up to $22,000 for something a little more glamorous. Yet, when it comes time to sell, outdoor kitchens are estimated to add between $6,000 to $9,700 (the northeast could see as much as $11,900 and the Pacific coast could see as much as $12,500). All in all, you’re looking at a maximum return of 71%. Not too shabby.
One way homeowners revamped their homes to make it more enjoyable is to add a deck to the backyard. They could enjoy the weather, have backyard barbecues with their kids (and guests once social distancing regulations were lifted) and just have a place to relax.
To build a deck, the homeowner could spend between $4,000 and $10,000 (the actual cost will depend on materials, labor, and size of the deck). The national average sits around $7,200 and when it comes time to sell, you can expect to see $6,900 - 97% return on that investment!
Backyard upgrades still add value
No matter what we do, when we’re pouring money into something (namely your home), you want to make sure that the investment will be worth it. The upgrades we mentioned here are still desirable among buyers, but you aren’t going to be able to recoup the entire cost. That doesn’t really matter though because you can still enjoy the improvements while you’re still living there. So it’s a win-win!