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Return on Investment

A new roof these days, even for a modest sized home, is a large investment for the homeowner. There are always questions as to the necessity of doing a re-roofing job, and most of all what it might mean to the homeowner in terms of costs re-cooped. We’ve included a number of industry statistics regarding ROI (Return on Investment), but would also like to add that the roof to any home is one of the very most important structural elements that need to be in perfect “working” order. No leaks, no potential problems readily discernable; and a roof that looks good to the appraising eye. We hope you’ll find the following informative and useful.

Question: What will my “return on investment” be when I purchase a new roofing system?

According to Popular Mechanics May 2009 issue, “…homeowners can expect to recoup as much as 75% of the cost of their new roofing system in market value as soon as it’s installed.”

What does this mean? Let’s take a look!

Example: The owner of a $300,000 home is considering purchasing a new roof system at the national average cost of $9,866*.

Fact: Property values have increased at an average of 6% per year nationally since the Great Depression (1998 Census Bureau Housing and Household Statistics Division). According to the Chicago Sun Times, Washington State property values have increased by 14% annually, but in our example we’ll use a modest rate of 6%.

According to the November 1, 2004 issue of Remodeling Magazine, the national average cost of roof replacement is $9,866 for a 2600 square foot or “26-square” roof.

Homeowner Does Nothing Homeowner Buys a New Roof
$100,000 home value increasing 6% annually, but roof is deteriorating
$100,000
+ $7,400
$107,400
home value
(75% x 9,866)
new value
1st Year
2nd Year
3rd Year
4th Year
5th Year
– $106,000
– $112,360
– $119,102
– $126,248
– $133,823
1st Year
2nd Year
3rd Year
4th Year
5th Year
– $113,844
– $120,675
– $127,915
– $135,590
– $143,726

 

As you can see, the roof pays for itself in 5 years.

Thank you for considering Addicott Roofing, Inc. If you’re interested Click Here for Free Estimate.