It’s estimated that almost 7.2 million Americans will get a refund this year averaging $3,000. How should you put that refund to work? If you’re a homeowner, here are the options that yield the most return.
Home improvements that pay off in the long run.
- A new steel front doors costs around $250, but is worth $1500 when you sell.
- Refinishing hardwood floors costs around $1,800, but is worth $5000 when you sell.
- New insulation costs around $700, but will return about $2000.
- Some Energy efficient upgrades qualify for tax credits next year: Biomass stoves, Heating, Air Conditioning, Insulation, Roofs, Water heaters, Windows, Doors, and Skylights. Check with your tax advisor for limitations. You’ll also have a more appealing property to sell, and reap the benefits of reduced utility bills/energy efficiencies.
- Consider using your refund to pay down mortgage principal. It could save you tens of thousands of dollars in interest and add more equity.
- If you’re planning to sell, consider hiring a professional stager. Staging allows the buyer to see the space as their potential new home, instead of belonging to people who live there. Staging is proven to accelerate the sales process, making it more than worth the investment.
- Make your “honey do” list of small things you have put off repairing. Hire a handyman to fix that broken gate, install a new energy efficient toilet, refresh a tired paint color, or switch out a dated light fixture.
Using your tax refund to improve your home’s value is one of the smartest investments you’ll make this year!