Top renovations you may want to rethink

Whether you're thinking about selling or staying put, homeowners considering major renovation projects would be wise to devise a plan. Some renovations aren't worth the hassle, investment dollars and can actually hurt your chances of selling your home in the future.

Indeed, beauty is in the eye of the beholder so if you're thinking about a major overhaul to your home or property, do your homework first.

Frances Hinojosa, a mortgage expert at BMO Bank of Montreal in Toronto, says kitchen and bathrooms continue to be the best place to sink your renovation dollars, but she cautions home owners on curtailing renovations to fit their individual tastes.

"Of the value-busting renovations that people do it's usually stuff that not everyone will find value in or it's something that's out of the ordinary," she says. "Renovating the kitchen and bathrooms will see you get the most return on your money."

Avoid splashing out on lavish materials like imported marble or hand-painted wallpaper. Most home buyers will want to personalize their living space and won't care that the crystal chandelier took 12 weeks to ship from Italy.

Know your neighbourhood
A general rule of thumb is to be sure your renovations fit with the scope of your home and the neighbourhood.

"Avoid things that'll over-improve the house or neighbourhood," Dianne Usher, division vice-president of Royal LePage Johnston & Daniel in Toronto says. "If you're living in a condo where the average price is $500,000, don't buy it for $300,000 and then invest a further $300,000. Keep your costs to a minimum. Same goes for a house … don't build a 'McMansion' in a neighbourhood that won't sustain it."

Thinking regionally also helps. If you live on either coast and can drive to the beach in under 20 minutes should you spend your investment dollars on that kidney-shaped pool you had your heart set on?

Not everyone wants to put in the work
Renovations that take a lot of work to maintain -- think swimming pools, landscaped ponds or lush gardens -- may scare away potential home buyers.

"If you live in an area where swimming pools appear to be the popular choice, then maybe that's something you want to consider since everyone moving into that neighbourhood expects to have a house with a pool," Hinojosa says. "Be careful when you renovate that you don't over-improve your house based on the area that you live in."

Be careful with space conversions and additions
Thinking of building an in-law or income suite over the garage? Does your attic just scream "man cave"? Ultra-specific additions or room conversions may hinder your chances of selling down the road, especially when the neighbourhood demographic is changing. There is likely no need for an granny apartment in a neighbourhood full of young families. What conversions get the most bang for their buck?

A "midrange attic bedroom" will likely return 72.5 per cent of your investment, according to the National Association of Realtors and Remoding magazine's annual Remodeling Cost vs. Value report.

The project that garners the least return on investment is a sunroom addition and home office remodel. Home owners can expect to recoup 46 per cent of what they invested in the project.

Some other areas where you may want to rethink your renovation plans:

• Gazebos

• Kid's jungle gym or play area

• Built-in hot tub

• fountains, lavish landscaping or hardscaping

• Custom carpeting

• Home entertainment wiring

Be aware of the overall market

It's also prudent to keep an eye on how the real estate market in your locale is performing and to be aware of what the projected trends are.

"For instance, Vancouver isn't so buoyant right now so you're advised to be very conservative on any renovation right now until the market starts to show a strengthening," Usher remarks. "Having said that, it's always wise to keep a home in a good state of repair and to keep it freshly painted."

One other area of caution to be aware of and it's a big one is choosing a contractor.

"Many homeowners embark on home renovations as a do-it-yourselfer and painting is one of those projects," Usher says. "But whatever you do, always use licensed trades for all mechanicals and if you're doing an addition renovation, make sure you're using a licensed contractor and get their credentials and testimonials."

If you are planning on renovating your home, be sure to consult the Canadian Home Builders' Association website for practical advice and for information on hiring an accredited contractor.