HGTV’s popular series Bang for Your Buck brings the concept of return of investment for home improvement projects to life.  Choices made for major remodeling projects are evaluated for finishes and design to determine which homeowner realized the greatest return on their investment.

Window replacement is consistently one of the best home improvement projects for achieving maximum return on investment.  Real estate experts rate window replacement as one of the best improvement projects for increasing home values with an increase in market value of 60% to 85% of the amount invested in replacement windows.

Understanding how replacement window selection impacts return on investment is usually not as clear cut as determining the impact of granite countertops. Homeowners who want to achieve maximum return on investment from their window replacement project should carefully consider the following three factors that substantially influence their potential return on investment.

Under-improving

When selecting replacement windows, homeowners should ensure that the replacement windows fit their community and their home’s market value.  Under-improving has risks that are not associated with over-improving.  Selecting a replacement window that is typically found in a significantly less expensive home and community has the potential to decrease a home’s desirability. Decreasing desirability decreases return on investment.

Under-improvement most often occurs when the wrong material (finish) is selected. The most common materials for replacement window products are premium clad wood windows, composite and high quality vinyl.  Premium clad wood windows are the most expensive in this range; high quality vinyl windows are the least expensive. Selecting a material that fits the home’s value and community is essential for achieving maximum return on investment. Identification of the window materials commonly found in the surrounding community along with the home’s market value will help homeowners identify the materials (finishes) that will provide the greatest return on investment. Generally choosing to under-improve your home is not a good financial move.

Over-improving

Selecting a product that results in over-improving your home based on its market value and the surrounding community is not a wise financial investment.  However, over-improving does not carry the risk associated with substantial under-improvement.  The percent of increase in your home’s market value will be significantly less than average for replacing windows if the replacement window product selected results in substantial over-improvement of your home. Homeowners may have valid reasons for selecting a product that is more expensive than optimal based on their home’s value and location.  When other reasons drive the decision to over-improve, it is important to be realistic about the project’s impact on your home’s market value. 

Architectural design and replacement window style

Selecting replacement windows that are optimal for the home’s architectural design is important for maximum return on investment.  This is an important but often overlooked consideration in replacement window selection.  Homeowners should carefully determine appropriate options when making a change from the window style that was originally in the home. The first step is to determine the style(s) that would typically be used with the home’s architectural design.  Window styles include: single hung, double hung, casement, awning, special shapes, horizontal sliding and picture windows. 

Three important things to remember if you want the most bang for your buck are:

  1. Select an appropriate material (finish) for the home’s market value and community.
  2. Make sure that the replacement window style is optimal for the home’s architectural design.
  3. Select a moderately priced product in a material (finish) that is appropriate for the home’s market value and surrounding community. Avoid under-improving and over-improving if you want to achieve maximum return on investment.