Keeping your home well maintained and in good repair is certainly necessary if you want to protect a major investment in your retirement years—and increase the house’s value in case you might want to sell it one day and move. Some people go further, though: they want to make major capital improvements.
Are home improvements worthwhile? Probably, if you enjoy a new kitchen, say, or central air-conditioning. A larger question, though, is whether they make sense as an investment. That is, if you spend $40,000 to install new kitchen cabinets and appliances, does that increase the value of your house by $40,000, more, or less?
Every situation will differ, depending on the quality of the work done and the way the improvements blend in with the rest of the house. Also, certain types of home improvements tend to hold more value than others.
Generally, homeowners who improve their most frequently used rooms and those who add on more living space enjoy the biggest payback. People spend a lot of time in certain parts of the home, especially the kitchen and the bedroom. Making these rooms newer and more spacious adds value to your home.
On the other hand: Despite what you might think, a swimming pool is one of the least valuable features you can add to your home in terms of resale value because it limits the number of buyers who want to look at your home. Only in some parts of the country (such as Florida) does a pool increase the value.