The average price nationwide for having a professional do 27 common remodeling projects rose 3.1% last year, research that will be used in 2017's Cost vs. Value report shows.
Normally we wait until January, when the entire report comes out, to reveal the cost part of Cost vs. Value. But because that data is collected over the summer, in advance of when we survey real estate professionals for the Value side of the report, we decided this year to give an early view of the Cost side by publishing some of the numbers today.
The increases for each of the projects, shown in the chart above and the table below, varied from 0.3% for a master suite addition to 5.9% for several smaller jobs. Also included are average prices for two projects added this year: a backyard patio and a bathroom remodeled to universal design principles.
The 3.1% increase over the 12 months from July 2015 exceeds the general rise in inflation (consumer prices went up just 0.8%), the wholesale price index (it declined 0.2%) and labor costs (they rose 2.4% for private industry workers).
What’s driving the outsized gains? It could be because recent reports show the remodeling industry is enjoying its best economic conditions of this century. Metrostudy's latest Residential Remodeling Index (RRI), which taps a suite of economic reports known to influence remodeling activity, rose in the second quarter to a record 104.2. That's 4.9% better than where RRI stood in the April-to-June 2016 period and 1.4% better than it was in 2016's first quarter. Meanwhile, Harvard's Joint Center for Housing Studies says its Leading Indicator of Remodeling Activity, or LIRA, is pointing to year-over-year spending gains of roughly 8%.
When homeowners clamor to have work done, remodelers often raise their prices, if only to pay extra wages to keep good workers around. That demand, combined with the extra pricing pressure for materials applied by the new-home market, appears to be propelling the cost increases.
The numbers were compiled by the research firm RemodelMAX on behalf of REMODELING for use in our annual Cost vs. Value report. The report, published every January, reveals both variations in the cost of doing the same project in 100 metro markets nationwide and real estate professionals’ views of how much those projects will add to the value of the home at resale. The cost numbers assume a professional remodeler is doing the work.
Click here for descriptions of what’s involved in each of the projects we covered in our January 2016 report, as well as both the cost and value numbers we compiled in the summer and fall of 2015. And here are the national cost numbers we'll put into our 2017 report, ranked from least to most expensive:
|Project||Cost||Year-over-Year % Change|
|Replace Steel Entry Door||$1,414||5.9%|
|Replace Garage Door (M)||$1,750||5.9%|
|Replace Fiberglass Entry Door||$3,277||0.8%|
|Replace Garage Door (U)||$3,304||5.2%|
|Manufactured Stone Veneer||$7,850||4.4%|
|Fiberglass Grand Entrance||$8,358||4.9%|
|Wood Deck Addition (M)||$10,726||2.4%|
|Back-Up Power Generator||$12,870||1.2%|
|Replace Vinyl Windows||$15,288||3.8%|
|Universal Design Bath||$15,755|
|Composite Deck Addition (M)||$17,263||2.8%|
|Bath Remodel (M)||$18,572||3.7%|
|Replace Wood Windows||$18,767||3.8%|
|Minor Kitchen Remodel||$20,848||3.6%|
|Composite Deck Addition (U)||$39,371||3.8%|
|Bath Addition (M)||$43,284||2.5%|
|Bath Remodel (U)||$60,030||4.6%|
|Major Kitchen Remodel (M)||$62,214||3.7%|
|Bath Addition (U)||$81,586||2.8%|
|Family Room Addition||$89,687||3.5%|
|Master Suite Addition (M)||$119,660||0.3%|
|Major Kitchen Remodel (U)||$123,065||2.6%|
|Master Suite Addition (U)||$250,855||2.2%|