Five Home Improvements That Don't Always Add Value to Your Home

Everywhere you look these days, folks are sprucing up their homes. Although interest rates are rising, consumers are still enamored with the home improvement craze î º and with good reason. They have a lot invested. Balances on home-equity lines of credit have soared 71 percent to $543.2 billion over the last two years, according to an analysis by Equifax Inc. and Moody's Economy.com. Although some of this money was spent on consolidating high-interest credit card debt, vacations, and college tuitions, a large portion was earmarked by homeowners for improvements to increase the value of their homes. The problem, however, is that many of their investments may fail to recoup even half of their original spend.

You can't contemplate home improvement in a vacuum. While a media room is one of today's hottest remodeling projects, if your house is in dire need of an additional bathroom, then theater-style seating and soundproof walls will most likely be a wash at resale. If watching the latest blockbuster with your family in the comfort of your own home is worth more to you than whether you will recoup 60 to 80 percent of the project's cost at resale, then go for it. But don't expect potential buyers to get lathered up about the built-in surround sound system when the insect-damaged front deck is in need of serious attention. Below are five home improvements that don't always increase the value of your home.

Swimming Pools

You may envision hours of summer leisure and family fun. Potential homebuyers see maintenance, expense, and LAWSUITS. If you want to spend $75,000 on an in-ground pool and are prepared to get nothing in return for that investment î º except the pleasure of cooling off every night after work î º then go right ahead. Pools are actually one investment that can actually lower the value of your home. It is not uncommon today that a contingency of sale is that the current home seller must dismantle the above-ground pool or fill in an in-ground pool before the buyers will sign on the dotted line.

High-end Accessories

Unless your home is of similar quality throughout, don't over-improve one or two rooms with high-end accessories to the exclusion of everything else. You won't recoup even half the money you spend on a restaurant-quality cook top, a whisper-quiet dishwasher, and imported Italian floor tiles if you only have one bathroom with pitted vinyl flooring, a leaky faucet, and bedrooms that haven't had a change of paint since the 1960s. A rule of thumb is to keep everything in your home of similar style and quality and keep your home within the top 25 percent of other homes in your neighborhood.

Wall-to-wall carpeting

Beat-up wall-to-wall carpeting may detract from the value of your home, but ripping it all out and replacing it with new carpeting isn't necessarily the solution. First of all, good-quality carpet is getting more expensive î º upwards of $15 to $25 a square yard, and that doesn't include installation. The other problem is that your choice of carpeting color and style may not match the decorative vision of any potential homebuyers. It might be better to remove the carpeting and take the money you would have spent on replacing it and spend it on refinishing your hardwood floors instead. Then you can add small area or hallway rugs where they make the most fashion and comfort sense. These can be either kept in place or removed during home showings when it comes time to sell.

Elaborate Landscaping

Other than a pleasing-looking lawn and plantings that complement rather than over-power your home, landscaping doesn't necessarily add a whole lot of value to your home. It is mainly for own enjoyment. Elaborate gardens that will need extensive care î º possibly of a gardener î º may not recoup even a quarter of your investment at resale. Hardscape, such as stone walls and fences, is attractive, but most buyers won't even consider them in the value equation.

New Windows

With energy prices on the rise, installing replacement windows is an improvement many homeowners are considering. However, double-hung windows can cost anywhere between $200 and $300 and, unless you're a DIY wizard, you will have to pay someone to install them. With energy savings and an estimated resale value that hovers around 85 percent, according to Remodeling Magazine, standard replacement windows make sense in some cases. If your windows are in poor shape, with cracked and/or loose panes, sashes that are difficult or impossible to operate, and glass that just won't come clean no matter how much you scrub, replacing windows can provide you with a good return on your investment. However, if your windows are in good shape, your return will be much lower.