8 Home Renos That Make a Personal Loan the Perfect Choice To Boost Your Home’s Value
Written by
G. Brian Davis
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Rebekah Evans
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Want to add massive value to your home without spending massive money? Home equity loans and home equity lines of credit (HELOCs) can help you borrow large sums against your house. But they also typically come with thousands of dollars in closing costs, including a full title search.
That makes them an expensive choice if you want to spend $5,000 to $25,000 on smaller home updates. For these lower-cost renovations, consider a personal loan instead for its lower fees.
The following home renovations deliver relatively high return on cost for roughly $25,000 or less: perfect for a personal loan.
Curb Appeal Improvements
First impressions matter and nowhere more so than real estate.
Fortunately, it doesn’t have to cost an arm and a leg to boost your property’s curb appeal. Real estate professional Jessica Robinson of Family Nest North Central Florida sees it all the time: “A fresh coat of paint, a new garage door, modern light fixtures and landscaping upgrades like mulch, flower beds or even a small patio, all for $5,000 or less total, can completely change how your home shows.”
In fact, a Journal of Light Construction (JLC) report found that garage door replacements came with the highest return on investment (ROI) of any home improvement, recouping 193.9% of the average cost ($4,513) — making a personal loan an ideal funding option.
Entrance Upgrade
Similarly, replacing or upgrading the front entrance door also delivers high returns for funding with a personal loan.
The JLC report found that replacing front doors with steel entrance doors delivers an ROI of 188.1%, while replacing it with an expanded “grand entrance” delivers an ROI of 97.4%.
Manufactured Stone Veneer
Stone exterior walls look classic — but they don’t have to be real.
“An option like Versetta Stone offers the authentic, handcrafted look of stone in panels that are easy to install with nails and screws,” explained Steve Booz of Westlake Royal Building Products.
Sure enough, stone veneer ranked as the third highest return among home upgrades in the JLC report, boosting home values by an average of 153.2% of their cost.
Minor Kitchen Remodels
Get creative with low-cost, high-impact upgrades you can make to give your kitchen a modern look on a modest budget.
Lane Forhetz, owner of Fast Lane Real Estate, has seen smart kitchen upgrades boost home values by triple their cost. “Even small changes like fresh paint, new cabinet handles, replacing dated light fixtures and resurfacing countertops can boost perceived value dramatically,” Forhetz said.
The JLC report found that minor kitchen remodels delivered an average ROI of 96.1%. But major upscale kitchen renovations didn’t return nearly as much of their cost, boosting resale values by just 38.0%.
Siding Replacement
Replacing the exterior siding can also bump your home’s value. New fiber-cement siding returns 88.4% of its cost and new vinyl siding returns 80.2% of its cost on average.
Before you borrow money however, try simply giving your siding a deep clean with a power washer. It might look brand new for hundreds rather than thousands of dollars.
Deck Addition
Buyers love outdoor living space and that’s reflected in the high ROI on deck additions (82.9%).
“Depending on the size and material of the deck, the costs run between $40 to $80 per square foot,” said Joe Raboine from the exterior renovation firm Oldcastle APG.
Bathroom Renovation
Like kitchen renovations, you can make huge visual changes without spending huge money. The JLC report puts the average cost of a midrange bathroom remodel at $25,251, with a cost recovery of 73.7%, but you don’t have to spend that much.
Realtor Eli Pasternak of Liberty House Buying Group sees clients do more with less all the time. “Fixing up bathrooms for less than $15,000 makes sense for personal loans as the projects stay manageable but buyers really notice new-looking bathrooms,” Pasternak said. “We had a client install a new vanity, toilet and floors for $12,000 and got all that money back plus extra when he sold later.”
Home Office or Gym
Working from home remains extremely popular, with CNBC reporting that while only 20% of new job listings on LinkedIn are fully remote, they’re generating 60% of the applications.
Look for underused space in your home — especially space that can’t count as a bedroom — and brainstorm creative ways to convert it to an office. For example, could you finish part of your basement as a home office? Or convert unused basement or garage space to a home gym?
“Converting unused space into a home gym or office is one of the most underrated upgrades right now,” said Thomas Altadonna, owner of Platinum Fitness. “Post-pandemic, buyers want convenience and wellness built into their home lifestyle.”
Most home upgrades don’t fully pay for themselves financially, in the form of higher home resale value. But you do get to enjoy them yourself, potentially for years to come before you sell. Take into account both your own personal value and the added resale value when you consider which home renovations to make with a personal loan.
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