Maximizing Renovation ROI
Though home renovations have an impact on a property’s resale value, most don’t recoup their full costs, at least according to Remodeling Magazine’s 2020 Cost vs. Value Report. The report found that a minor kitchen remodel, for example, will yield only a 79.7% return on investment.
Curbio specializes in pre-sale renovation, and our ROI data tells a different story. In fact, our renovations deliver a 113% ROI on average. This $72,000 renovation, which included both interior and exterior renovations, garnered a 117% ROI. These types of returns are common for Curbio projects, which, naturally, leads some to ask, “How could Curbio’s renovation ROI be so high compared to other studies?”
The short answer is that pre-sale renovation is drastically different than traditional home improvement and requires a complete reinvention of the renovation process.
A singular focus on resale value
Until Curbio, homeowners had to rely on typical general contractors for pre-sale renovations. But most general contractors are not experts in pre-sale home renovation – they’re experts in executing on a homeowners’ vision. Moreover, the homeowner and the GC have competing interests: Sellers must avoid over-renovating and while GC’s want to expand the scope to increase revenue.
Because Curbio specializes in pre-sale renovation, we eliminate these conflicts. Our home improvement consulting team consists of former real estate agents, flippers and designers who understand which upgrades will help the home sell more quickly for a higher market price – and which won’t. And since we don’t get paid until closing, we have no incentive to encourage needless renovations that will delay time to market. The result? Smarter renovations with a higher ROI.
Buyer-focused renovations
To maximize the return of a renovation investment, homeowners need to understand what buyers in their market are looking for and then select materials, appliances, paint colors, and finishes that will have broad appeal. Quality, cost, and availability must also be considered. But few sellers have the expertise—or patience—to know which materials will maximize home value. ROI is doomed from the start.
Curbio’s comprehensive design-build services transform this process. Our Production and Materials Management team studies trends and curates a custom supply chain of the best materials based on local buyers’ preferences. By renovating according to buyers’ tastes, we expand the pool of potential buyers and drive up the sale price of the home.
Data-driven cost control
Many contractors lack a basic system for setting pricing, relying instead on perceived homeowner budget or even how busy they are that month. This is why homeowners often get three proposals that come with very different prices.
Curbio’s technology platform includes a proprietary database of data eliminates the typical guess work inherent in contractor bids. All customers get the same fair pricing, based on national pricing data from similar projects that’s adjusted for local markets. Curbio projects will typically come in 20% below the regional average on price.
The traditional materials procurement can also add cost, since most contractors purchase appliances, paint, etc. at retail prices with a nominal discount, or require sellers to purchase materials on their own. The cost and quality are limited by what’s immediately available at the local big box store.
Because Curbio is a national company completing hundreds of projects at a time, we have partnerships with highly regarded national manufacturers. This allows us to drive down costs and ensure availability, without sacrificing quality. Curbio’s onsite project manager handles all materials procurement, eliminating costly delays.
To learn more about how we maximize ROI, register for our next webinar or request a fast, free estimate.