Is Your Dream Kitchen a Good Investment?

According to Harvard’s Leading Indicator of Remodeling Activity, annual U.S. spending on home improvements and repairs is projected to reach $522 billion by the end of 2026, after a modest rise of 1.6% (year over year).¹

The nation’s stock of existing homes for sale is older than ever before, so undertaking major remodeling projects can seem reasonable, or even essential, when a buyer purchases a fixer-upper.² And for homeowners who have gained significant equity over time, it’s usually possible to obtain financing for costly renovations, even if today’s high interest rates cut into affordability.

Kitchens and bathrooms are among the most popular and expensive home improvements. You might easily be tempted to spend a small fortune on a high-end design like those often featured on TV shows and circulated on social media.

If you plan to sell in the next few years, it’s important to pay close attention to which upgrades could help attract more potential buyers and provide the largest return on investment (ROI). However, if you intend to stay put, you have more freedom to make choices that will enhance your family’s life. Either way, it’s important to make responsible borrowing decisions and keep costs under control.

Payback time

Two important takeaways from the Remodeling 2025 Cost vs. Value Report may help you choose more cost-effective home improvements.³

1. Curb appeal is (almost) everything. By and large, projects that make the exterior of the home more appealing (such as replacing doors, windows, and siding) tend to provide better returns than interior changes.

2. Smaller jobs can unlock bigger returns. When it comes to kitchen and bath remodels, homeowners may see a larger ROI for low-cost cosmetic changes (such as new appliances, cabinet fronts, fixtures, and paint) than they would for major reconstruction and/or upscale finishes.

Of course, a homeowner’s actual return on investment depends on the home’s overall appeal, buyers’ expectations for the neighborhood, and conditions in the local housing market.

National average return on investment

This information is not intended as tax, legal, investment, or retirement advice or recommendations, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek guidance from an independent tax or legal professional. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. © 2026 Broadridge Financial Solutions, Inc.