That’s a good question and not one that is easy to answer; because there is no set answer. Several variables need to be taken into consideration. The most important variable is: how long do you estimate living in your current home? If you are selling right away, the odds that are that you will only recoup 70 cents on the dollar for money spent. The longer you remain in your home, the more the money spent on your new kitchen will be wrapped up in the total price of your home.
So, how do you make the decision on how much to spend? Do you want to go for the ‘value’ remodel or the ‘quality’ remodel? Who are you remodeling for? Your first thought might be ‘me, of course,’ but if you plan on selling your house within the next two years, you will actually be remodeling for the new owner. Most homeowners do not differentiate between ‘value’ and ‘quality.’ Their goal is to end up with something that looks new and fresh, not really concerned with what goes on behind the scenes, if the finished product is functional and suited to their needs.
Do you know the average home value in your neighborhood? For instance, if you live in a $325K home and homes selling in your area are averaging prices of $325K, spending $75K on your kitchen will price you out of your own market. On average, most homeowners report that a kitchen remodel costs $21,633. Smaller projects will run between $10K and $15K, which might include a fresh coat of paint, refaced cabinets, a new sink, and installing a tile backsplash. A higher end remodel might cost more like $30K, which could include custom cabinets, hardwood floors, granite counters, and new appliances. Will a higher end kitchen out-pace your neighborhood market price?
Here is an example of how the costs breakdown:
35 percent: cabinets
20 percent: labor
20 percent: appliances
10 percent windows
5 percent: fixtures
3 percent: fittings
7 percent: other + 20% for the unexpected.
The rule of thumb is that you should spend between 5 and 15% of your home’s value on a kitchen remodel. Where you fall in that range depends on how important a kitchen is in your family life and how long you plan to remain living there. Remember, in remodeling, as in most things, you get what you pay for. If a beautiful, highly functional, hard-working kitchen is your dream, your costs will be on the higher end.
The kitchen is the heart of the home. It is where your family meals are prepared, where the family gathers on holidays, and where friends congregate at parties. Of all the home remodel projects, kitchens can be the most complex, the most expensive, but the one adding the most worth to your home, whether you plan to sell or plan on living there for years to come.