The average cost of upgrades and the amount that most buyers pay for upgrades varies considerably by area and also by the overall value of the home. The average amount customers pay for upgrades depends largely on good pricing strategies among home builders in the area and upon various economic factors such as recession. Upgrades are a choice and so their purchase depends on whether people have the extra money to spend, and whether they feel the upgrades are priced fairly.
Southern Atlantic Prices: A couple buying a $150,000 home in a Southern Atlantic state might pay $25,000 for upgrades including hardwood floor in the living room, tile in the kitchen and dining area, a fireplace, 9 foot ceilings, granite countertops, a cabinet upgrade, a kitchen island, gourmet kitchen, a large Jacuzzi tub and a sink upgrade.
If a family in the Southeast opts for hardwood flooring on the first floor it could cost about $20,000 at most. Wood laminate runs about $15,000. If it is available engineered maple can be a bargain at $8,000 for the same area. Even in the south though, it is possible to rack up quite an expense in upgrades. It’s possible to go over $150,000 with most home building companies if you choose to.
A couple buying a home on the West Coast might pay about $10,000 for a mere carpet and tile upgrade, and $12,000 – $18,000 for better cabinets and countertops. In general in the most expensive areas of the country, upgrades can cost more than double the prices in the South. This same differences in other construction prices are even more pronounced in upgrades.
The average cost of new home upgrades per house is about 10 percent of the cost of the home, but that average does not hold consistent throughout the market. Homes with a base price of $180,000 or less averaged upgrades of about 7.3 percent. Homes with a base price of over $300,000 had an average upgrade cost of 11.4 percent above the base price.
Average Upgrade Spending in *2005 – 2006
Los Vegas NV 2.9 % $7,000
Milwaukee WI 7.3 % $22,000
Washington DC 7.5% $35,000
Charlotte NC 10.4% $22,800
Fort Meyers FL 15% $37,500
These figures not only reflect the price of upgrades, but the prevalence of their popularity with homebuyers, the current economy and whether the cost of upgrades is deemed fair. Some home builders have experienced sudden drops in upgrade sales from one year to another because the upgrades were not priced fairly in comparison with the rest of the market.
Often home builders and contractors use upgrades to make buyers feel like they got a great deal. It’s not uncommon for builders to sell upgrades half off, or give them as rewards or bonuses. Some home builders try to use free or discounted upgrades as leverage to encourage home buyers to use their lenders. It is a good idea to place a more realistic value on upgrades by pricing the job with independent contractors and learning the cost of the materials as well. Don’t pay more than the fair market value for upgrades.
When deciding which upgrades to buy, it is important to consider which ones matter to you most, and also which ones are wise business decisions. Generally anything that increases energy efficiency is well worth the cost. In addition if you plan to resell the home in the next ten years, then go with the upgrades that lend most to increasing the value of your home. If you don’t intend to sell your home, then purchase the upgrades that are most important to you or your family.
There are many different reasons to choose to purchase an upgrade. It is important to consider each and every cost and whether it is worth it to you, when considering the average cost of upgrades.