How to calculate the home price increase from a renovation: multiply the project’s build cost by its recoup rate, then add that figure to your current home value. The recoup rate is the share of the cost that comes back as added resale value. That single multiplication is the entire method.
The formula
Two lines of math
Value added = build cost × recoup rate
New home value = current value + value added
The inputs
Recoup rates by project
These are the rates our calculator uses, based on typical returns across Southwestern Ontario and the GTA.
Worked example
A $60,000 kitchen on an $850,000 home
- Build cost of the kitchen remodel: $60,000.
- Recoup rate for a kitchen: 70%.
- Value added: $60,000 × 0.70 = $42,000.
- New home value: $850,000 + $42,000 = $892,000.
Add a second project and you repeat the same step, then sum the value added. A $25,000 bathroom at 65% adds about $16,250, taking the example home to roughly $908,250.
Second opinion
The Reddit objection: renovations never pay back
Post this formula on Reddit and the most common reply is that a renovation returns less than it costs, so the calculation is pointless. Threads like r/appraisal: “How much value do renovations really add?” lean hard on “you renovate for yourself, not for the sale.”
The premise is correct, recoup rates below 100% mean exactly that, but the conclusion does not follow. The point of the calculation is not to find a profit. It is to know the true net cost of the project: a $60,000 kitchen that adds $42,000 really costs you $18,000 of equity. That number is what makes renovate-versus-move decisions rational instead of emotional. Our home value calculator runs that net-cost math for every project at once.
Skip the math
Let the calculator do it
Our free home value calculator runs this for every renovation at once. Enter your current value, add as many projects as you like, and it returns the projected new value using the rates above.
Open the home value calculatorRelated
Which renovations to pick
Not sure which projects are worth it? How to increase your home price ranks renovations by resale return.