WASHINGTON, D.C., Dec 23, 2005/ MF / - This period of historically low interest rates and appreciating house values has prompted many homeowners to use cash-out refinancing or home equity loans to fund remodeling and home improvement projects.

But when it comes time to sell, how do owners know which remodeling projects will return the most bang for the buck?

The 2005 Cost vs. Value Report published by the National Association of Realtors (NAR) in REALTOR Magazine shows which home remodeling projects add the most and least value to a home.

For nine years, NAR members have been providing resale information to Remodeling magazine for the annual report that details costs and resale value of 18 remodeling projects in 58 different U.S. housing markets. This year’s findings show that kitchen and bathroom projects are returning more of a homeowner’s investment than ever before.

Some of the report’s highlights include:

• Many homeowners who complete midrange bathroom remodels can expect to make money; the cost on a national average for this project is $10,499, and the return is $10,727, or 102.2 percent, compared with 87.5 percent in 2002.
• On average, major midrange kitchen remodels cost $43,862 and return $39,920, or 91 percent of the costs to remodel, up from 66 percent in 2002.
• Nationally, homeowners who add an attic bedroom spend an average of $39,188, and on resale, they recoup 93.5 percent of the cost.
• Master suites, however, do not fare as well; an upscale addition, which costs $137,891 on average, returns only $110,512 on resale, or approximately 80.1 percent of the remodeling expense.

The December issue of REALTOR Magazine features 10 of the 18 projects. For a synopsis of the report, visit www.REALTOR.org/realtormag