And while a $50,000 renovation may not be in the cards for everyone, Highland says some of the biggest bang for your buck comes from smaller projects.
“New carpet and paint are dirt cheap,” he said, “They are the easiest thing to do for the highest return.”
You get the best return on investment by focusing on the main living areas, the kitchen, bathroom and the master suite, followed by the flow of the house, said Shane Steele, vice president of marketing at Sundae, a California-based real estate investment company.
Keep the fixtures and finishes somewhat neutral, she said, so they will be more appealing for multiple buyers. “Add the flair with your decor that can be taken with you when you leave.”
And while a neutral palate and a universal appeal should be the goal when renovating, retaining original details can help a home stand out.
“Where possible you should try to preserve the bones of the house,” she said. “Any details like crown molding, arches, built-in shelves should stay, because there is demand for character.”
Too much renovating or not enough?
With some projects, you likely won’t get back all the money you put in. Creating an organized closet may improve your life, but it doesn’t go very far on the resale market.
Only 40% of a closet renovation is recouped, according to the study. The estimated cost of closet remodel is $6,300 and about $2,500 of that is recovered in a sale.
While renovations of additional living spaces like the attic or basement will recoup more than half their cost according to the study, Highland said they are less desirable than kitchens or bathrooms.
Avoid customization and focus on features that have mass appeal, said Quinn.
“People get their hearts set on a particular thing,” she said. “A spa shower. Imported lights. A particular kind of tile. Sure, if you’re going to be here forever. If not, the next person isn’t going to value that and you won’t get your money back.”
Similarly, she said, people can go too far with open concept. Taking out all the walls to improve flow may be appealing to future buyers, but they will still want to see a place where they can put their sofa and television.
Under-renovating can be a problem, too. Within a given price range or neighborhood, buyers expect a certain quality of materials and level of finishes, she said.
“In some areas there is an expectation that a new floor would be hardwood instead of laminate,” Quinn said. “If you put in laminate floors, that would be detracting for buyers. Better to not do the renovation, if you’re going to go so far low that a buyer would pull it right out or not buy because of it.”
WRITTEN BY ANNA BAHNY FOR CNN.COM