How to Add Value to your Home with a Garage Addition
Because I live in the arctic of Minnesota, garages are a game changer! So many homes in the Twin Cities are either missing a garage altogether or only have a one car garage. This is because when homes were being built back in the early 1900s, you were lucky if you had one car to share amongst a family.
Well, times are a changing. Although I have a one car garage currently, I cannot fit my oversized SUV in the space. This is why I’ve prioritized it as my next project. Am I crazy enough to take it on right after my interior renovations? Maybe…
How much resale value does a garage and Bonus room really add?
Something to keep in mind with any renovation is the resale value. I preach the importance of this over and over. The kicker with this garage project specifically is that a garage addition isn’t a 1-for-1 cost to value ratio. In other words, if you spend $50,000 on a garage, it doesn’t automatically increase your resale value by $50,000. It will increase the number of buyers that would come through your home, and hopefully bring you more potential offers, but your list price would not automatically grow by that amount.
This is where the addition of finished livable space above the garage comes into play. By adding extra square footage to my Tangletown 2-story home (about 500 sq. ft.), I will increase my resale value of $675,000-$725,000, up to $800,000-$850,000. In other words, the cost of adding my garage and addition will increase my potential resale value by $125,000-$175,000.
How to pick projects based on adding resale value
A typical person of course would see $$$ signs with those types of value increases being thrown around. However, there are other important factors to keep in mind when determining the resale value of a home like size of living spaces, layout, formal vs. informal dining room, etc. It doesn’t always come down to square footage and bed/bath counts…although those are big factors.
With my house specifically, the hang-up that I most likely will face when it comes to resale value is the size of my kitchen. At only 12x10, my kitchen isn’t the smallest for Minneapolis standards, but it also isn’t the grandest. And when approaching the million dollar mark, this is a VERY important space to get right.
By removing the wall between the dining room and kitchen, the appearance of my kitchen will feel larger than previously. I will also be creating an overhang peninsula for additional eat-in space for entertaining. These two updates help immensely, along with the high end finishes such as custom cabinets, marble countertops, and more. Ultimately though, those don’t change the overall size of the space and will impact the resale value depending on the buyer’s needs.
How much does a new garage cost?
You’ve heard me mention this before, but renovation costs can range all over the board depending on the contractor, time of year, and cost of materials. Outside of those factors, a big ticket item to keep in mind with a renovation is the foundation. If you are digging up a new foundation, things can get expensive.
With my specific garage remodel, I will not be adding a basement, but I do need to have concrete work done for the garage slab and bases. Thankfully, I have found a contractor that has quoted me for half of what other general contractors have so instead of spending $80,000-$90,000 for a two car attached garage, my quote came in at $45,000.
On top of that, I have been chatting with neighbors in the area to see if they would like to piggy back their garage renovations with mine. This can be a game changer in pricing if you use it as a negotiating tactic up front! If my neighbors like the contractor I plan to use, and decide to move forward, this will help bring down the cost of labor and therefore reflect in my overall pricing.
My home as it stands today. The space on top of the garage is just begging me to make it all pretty.
How much does an addition on top of a garage cost?
Now, the addition on top of the garage is a different story. This cost will range depending on what finished space I decide to move forward with.
Example 1: I could leverage my existing smaller 3rd bedroom as a lofted space/hallway and add two bedrooms off the back, above the garage. This would increase my home from a 3 bedroom to a 4 bedroom. My contractor quoted me $15,000 for this project, which was insanely inexpensive for usable, finished space.
Example 2: Another option I could do is finish the space above the garage as an owner’s suite. This would include an oversized closet, one large bedroom, and bathroom. In addition, I would potentially add laundry. I haven’t gotten a quote on this quite yet, but by adding in plumbing for the shower, toilet and laundry, it will more than double my project cost. Typically adding a bathroom ranges from $10,000-$25,000.
How much does an architect cost?
Another expense you need to keep in mind with this type of exterior renovation work is an architect. I reached out to an architect that has experience designing around the original charm Minneapolis 1900’s neighborhood homes offer. Keeping my home’s style in mind is important to me when adding on the addition, and I know I’m not an expert in this field.
An architect is generally between 4%-6% of the “retail” cost of the project. You might be thinking…what do you mean, “retail”? Well that’s the funny thing. Even though I’m getting a GREAT deal on my overall project at around $60,000+ in total (garage = $45,000 + finished space = $15,000+), the “retail” value of a project this size is closer to $120,000-$150,000. Therefore, the architect will be charging me 4%-6% off of $150,000. (Insert head slap.) It feels like robbery to me, so we will see if my frugal mindset decides to move forward on that one.
Challenges of adding an addition to the garage
When you’re dealing with the exterior of a home, things can get pricey. Not only am I adding siding, but I’m also adding a roofline. While I’m very excited for the prices that I’ve been quoted for both the garage demo and addition, three additional expenses I need to keep in mind include: putting on a new roof, adding fencing, and matching my stucco exterior with exterior paint.
I planned on replacing the roof and painting all along, but was hoping to postpone that cost until next year. (It’s going to be gorgeous!) An easy way to get by without painting is by selecting a completely different siding. Think vinyl, brick, wood, etc. We will see what the architect suggests, but I have a feeling I will be doing stucco knowing me.
As for the fencing, I’m just going to wait and see. Because the contractors will have to dig up part of the cement slab and patio, and a number of other things, I will need to wait and see what all needs to be done with the oversized tree and fencing in the backyard. I’m hoping both are not too disruptive and can stay in place for the most part. Fingers crossed!
Sincerely,
Jen
Investor // Landlord and DIYer // Realtor // Business Consultant // Globe Trotter // Converting Vegan.
