How Much Value Does a Bedroom Add to a Home?

June 23, 2022

Real Estate

How Much Value Does a Bedroom Add to a Home?
Isn’t it easy to be seduced by the idea that “adding a bedroom increases my house’s market value by 6%!”? Disappointingly, many initiatives have dismal returns, which means homeowners won’t earn additional value even if they add more beds and baths to homes.
When it comes down to it, the value a renovation adds to your home depends on the location, present worth of your property, and other factors. Read on to find out more about how much value an extra bedroom adds to your home.

What is Your Selling Strategy?

It would be best to consider where you live when considering whether or not to add another room to your house. You’ll be able to make a better decision if you know what local home buyers desire in your area.
In certain circumstances, installing a home office or gym may be the most efficient and cost-effective solution. These additions free up space into a bedroom as well as create additional space in your home, which may seal the deal for young professionals who flock to your neighborhood.
Does adding a bedroom increase home value? Adding an extra bedroom to a two-bedroom house that is already very spacious could be a good idea. This allows the typical family with two children to move in quickly. Households with children who have gone to college have a spare room for elderly family members or visitors.
Be sure to consult with a local Realtor® before making a final decision. In your local real estate market, they can tell you what’s most popular.
Decide how much value an additional bedroom to your home may bring by comparing it to comparable properties in the area. The cost to add an extra bedroom might not pay off in the long run. However, if your property has just two bedrooms and one bath, an additional bath and bedroom might considerably boost the value of your home.
Since there is no assurance that you will get a good return on your investment if you expect to sell your home soon, you may want to explore converting an existing space and doing more minor, less costly home upgrades.

What is Your Home’s Layout?

Because of a fantastic layout, a property with three bedrooms might sometimes sell for the same amount as one with four. Suppose the square footage of a home with three bedrooms and one with four bedrooms are both 1,500 square feet. One house has more bedrooms than the other, making it seem like it has a higher value. But the property with three bedrooms is likely to have a bigger living room than the home with four bedrooms, which might help it compete favorably with the house with four.
This serves as a helpful caution against making the number of bedrooms the only deciding factor in any decision-making process.
What Is Your Return On Investment (ROI?)
Choosing ideal home improvement projects is essential in maximizing the value of your house. The ROI (return on investment) of different home improvements varies when it comes to home sales.
An additional bedroom is usually a good investment in adding value to your property. Perhaps you and your family would benefit from an extra room, and you don’t intend on selling the house for a long time. You can expect to boost your property’s value if you put it on the market.
The additional bedroom may enhance the value of your property, but this depends on different variables. A local real estate agent’s insight on the potential influence on your home’s worth might be invaluable in this situation. 
Additional bedrooms may raise the sales price of a house by $30,000 to $50,000. A lot depends on where you are, however. As a result, before making a real estate investment in the hopes of seeing a high return, you should consult with a real estate professional.
How much is a bedroom worth on an appraisal? The appraisal value of an extra bedroom will often only rise if the increased square footage is included. In other words, expanding a home’s square footage will raise its market value. For example, adding a 2nd or 3rd bedroom increases your home’s above-ground living space by at least 150 square feet and subsequently increases its market value.
Lastly, urban and rural markets can be very different. It may be more important to increase the number of bedrooms in a metropolitan area than in a rural one.

What Does Your Local Realtor® Say?

Ask an expert local Realtor® for advice before embarking on any home remodeling projects, such as an additional bedroom. Tiny rooms may turn off prospective buyers if your house is already modest.
Instead of taking on colossal construction costs, be sure it’s the appropriate decision for your position before making the investment.
With the help of a local Realtor®, you can learn in advance whether the addition you want to make would cause your selling price to diverge significantly from the comparables (comps) in your neighborhood, which might influence the value of your home in the eyes of lenders.
Using the 15% guideline when deciding how far you want to go with your home renovation project would be best. It would help if you keep your home’s worth in mind and not spend more than 15% of it on any one renovation. Renovations such as painting the inside and exterior or building of a deck seem to provide the highest return on investment (ROI).
Get an expert assessment from a top real estate agent, even if you don’t intend to sell, to find out whether adding a new bedroom can raise the market worth of your property.

Final Thoughts

Even if you spend $30,000 to build a bedroom in your attic space, you might not get your money back when you sell the property. You may save money and receive a better return on investment if you do a modest makeover of the whole house rather than a more expensive one or two-room renovation. If you’re planning to sell within the next year or two, save your money for improvements in your future house and do a few less costly ones instead.
Professional home stagers advocate investment in new carpets, fresh paint, and other minor renovations that will attract potential buyers.
Read here for more tips on how to increase your home’s value.

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