Closet Prices: Coset vs. Value
Recently a client asked me how an investment in remodeling his closet might impact the resale value of his home. This is an understandable concern since we were talking about a high end, custom wood closet that could run into thousands of dollars in cost. So, conscientious businessman that I am, I set out to find an answer that would satisfy my customer’s concerns—even though I already knew what it was.
The closet industry mantra—you are bludgeoned with it constantly in advertising and in trade journal articles—is that custom closets add to the resale value of your home. It’s one thing to prattle on to a customer about this glorious resale value, but it’s quite another thing to be able to put the issue in financial perspective with any real data to back up the ad rhetoric. Looking at the case at hand: the cost of the proposed master bedroom closet at $20K+, along with the pantry and mudroom closets we had already installed, totaled out at over $25K. So, how do I answer my client’s concerns over the lasting value of his considerable investment in his custom closet?
Let’s look at the numbers we do have.
The Remodeling Magazine Cost vs. Value Report does mention closets as part of a master suite addition, which it further divides into two categories: master suite addition and upscale master suite addition. The numbers for both are pretty similar in the New England region, around 70% return on investment. They define this project in terms of features, like total square foot area, bathroom, walk-in closet, millwork, French doors that open onto a deck, etc., total cost, resale value, and percent of cost recovered at resale. Should we assume that a high-end closet upgrade from wire to custom wood in an otherwise spectacular master bedroom suite would yield a similar 70% return on investment?
From our clients we have received feedback that says they agree that the closet upgrades they have made to their homes has helped to sell them faster. I one case with two camarable condos in the same building, one of our clients reports that theirs sold the first week on the market, while their neighbors condo had been for sale for months. Not scientific data, but it does offer some positive feedback.
In my opinion: Forget all the statistical voodoo. The way I have answered the question of resale value for my customers over the past thirty years of doing remodeling work is to return the same question to them, "What is it worth to you?" Ask yourself how any home improvement you are considering will impact your everyday quality of life, from a functional and aesthetic, as well as an economic point of view. For me it all boils down to two questions: Will it make you and your family happy for years to come, and can you afford it? Unless you are screaming and cheering a heartfelt YES! to both of these questions, your return on investment will probably fall short.
