2025 Renovation Trends: Which Can Help Your Home Value?

At the end of 2024, a CIBC poll found that nearly half of Canadians (49%) had recently completed or were in the process of planning or executing home improvements, with an average cost of $19,000.

Around four in 10 (41%) of those surveyed said they were renovating for cosmetic reasons, 39% to improve functionality, and just over a quarter (27%) to increase the value of their home.

While homeowners should put livability and functionality first when considering renovation projects, return on investment is an important factor to consider, Cameron Forbes of RE/MAX Realtron Realty Inc. in Markham, Ont., said via email.

“People should dream, plan and implement home renovations that will make their life easier and even more enjoyable. ROI is a good secondary consideration to ensure that the people live within their budgets,” he said.

Considering a renovation this year? Here are some home improvement trends that might help you update and personalize your space while also boosting resale value — and a few that might not.

Simpler renovations

Economic uncertainty and looming tariffs have resulted in many Canadian households putting larger renovation projects on hold for the short-term. Instead, they’re favouring cosmetic renovation work, such as painting and general maintenance, Forbes said.

Indeed, according to the CIBC poll, small upgrades and general repairs were the most common update undertaken by homeowners in the last 12 months, with just under half (46%) of respondents taking on this type of renovation.

“Painting and general maintenance work will always be a priority for homeowners. Regular maintenance must occur to preserve their home for the long term,” Forbes said.

💡 Did you know? Home equity loans, home equity lines of credit and personal loans can be lower-cost ways to finance a renovation if you don’t have the cash on hand.

Sustainable upgrades

New homebuyers surveyed by the Canadian Home Builders Association (CHBA) in 2024 ranked sustainability high on their lists, with high-efficiency windows, energy efficient appliances, HRV/ERV air exchange systems and an overall energy-efficient home all among the top 10 most desired features.

Energy efficiency has consistently been among the top must-have home features over the last nine years, the CHBA told NerdWallet via email.

Incentives that provide access to low-cost financing — like the Canada Greener Homes Loan or the City of Toronto’s Home Energy Loan Program — are spurring some of these types of retrofit projects, said Brendan Charters, development manager at Eurodale Design + Build in Toronto, in an email. Projects that qualify for these financing assistance programs include insulation, air sealing and renewable energy upgrades, such as rooftop solar panels.

“Future proofing against rising utility costs — and carbon taxes depending on the government of the day — as well as ensuring the homes are both comfortable, as well as healthy for the occupants, are big drivers of these changes,” he added.

Taking care of yourself and the planet also delivers decent ROI; according to the Appraisal Institute of Canada (AIC), energy-efficient renovations have one of the highest paybacks relative to investment, because of the reduced operating costs they deliver over time.

Expanded living space

Charters has seen increased interest from homeowners who want to turn basements into gyms, home offices, secondary suites and family recreation spaces, such as golf simulators or movie theatres.

“In many cases, making these once-forgotten and discounted areas of the home can increase the livable floor area for the occupants between 50 to 100% more. Improvements in waterproofing, flood protection and in-floor heating now allows for warm and dry spaces that rival the rest of the house that resides above the grass line,” he said.

🤓 Nerdy Tip: Not all basement improvements will deliver a great ROI. “They still remain darker, colder areas of the home to spend time in, regardless of the premium finishes,” Forbes says about basements.

Which renovations have weak ROI?

While they may rank high on the enjoyment scale or bring an added level of sophistication or beauty to a home, some home improvement projects just don’t deliver when it comes to increasing property value.

Landscaping

Although the satisfaction levels can be high, Forbes said some exterior work such as replacing cement or asphalt surfaces with bricks, planting new trees, installing driveway heating systems or artificial turf are often associated with lower return on investment.

Pools

A pool can be a fun addition to a property — but it is not always a selling point or a value driver.

“They are a luxury and always have been. They skyrocketed in value during the pandemic as we were all stuck at home, but they can be an energy sink, cost a lot to maintain and after the first few years are not often in regular use,” said Charters.

“Thankfully you can’t discount enjoyment value — fun is also a good ROI, it can’t all be financial,” he added.