There are many ways to plan the future of your home to provide an investment return. One effective way to grow your home’s equity and provide yearly monetary gain is through a plan of annual capital improvements for your home.
Annual capital improvements are projects done on your home throughout the year for the purpose of maintenance, replacement of worn aspects of your home, or the addition of new upgrades. These enhancements provide an increase in the cost market value of your home, create new and better uses for your home, or improve its current function.
These improvements for your home can come in many forms. Whether it’s a roof replacement, overall maintenance or replacement of plumbing, new appliances, or building an add-on structure to provide an additional bedroom, any major improvement costs you plan for your home can be used as annual capital improvements.
Capital improvement plans aren’t just for homeowners to use. Businesses and city planners can fulfill the maintenance, replacement, or addition requirement for the purpose of improvement. Along with a diligent homeowner, these businesses and cities can also use the benefits provided by them.
An annual capital improvement plan can provide more than one benefit to a homeowner. While some of the pros might seem clear, there are many additional reasons investing in one of these plans can provide a positive impact on your home.
At face value, they provide positive cost equity in your home. When you plan the replacement of damaged siding, add on an additional room, or overhaul the electrical system of your home, you provide equity that will increase the resale market value of your home. In addition to the investment equity that comes with annual capital improvements, the IRS provides benefits for those who plan replacement or maintenance to their home throughout the year. Each improvement that increases the cost market value of your home, provides new use, or prolongs the functional use of your home can be filed as a federal tax deduction with the IRS.
UMH Properties, Inc. also invests in an annual capital improvement plan for all of its communities. Each of the improvements our plans provide go straight back to benefit the residents and homeowners of our manufactured home communities. Much like a neighborhood HOA or an apartment fee, our residents pay monthly lot rent that UMH Properties, Inc. uses to fund these improvements for each community. Each year we plan ways to satisfy our residents in our manufactured home communities. With plans like road repavement, playground and recreation area upgrades and maintenance, or the addition of new amenities, we invest in the community to increase the value of your home.
During the most recent year, when most found themselves spending more time at home than ever before, our team invested in playgrounds, outdoor fitness equipment, picnic and barbeque areas, and pavilions. We strive to provide residents with entertaining ways to enjoy the outdoors when they need it most.
How can you make the most of your annual capital improvements this year? Create a plan! While annual capital improvements provide many benefits, they also come with a cost. Creating a plan for replacement or maintenance can put you in the best position to make lasting investments for your home.
Begin by deciding which improvements would most benefit your home this year. If there are obvious aspects of your home that need maintenance, provide focus to those areas in your plan. If you’re not sure where to start, do some research on lasting benefits to provide for your home. For example, fulfill an energy efficiency plan. Invest in a replacement of your windows, your HVAC system, or new energy-saving technology for your home.
Your list of projects might be long, but you’ll need to choose a priority for each annual plan. Gather information and price estimates for each item on your plan and decide which cost will fit for you.
Most importantly, your plan has to match your budget. Once you’ve priced out your plan, make sure you have the savings available or request the financing you’ll need to make it happen.
Finally, put your annual capital improvement plan into action. Create new cost equity in your home and enjoy the tax deductions that come with a good investment.