“How much money can I get out of my renovation?”

This month’s newsletter was inspired by a random call I recently received. A gentleman had purchased a condo on Central Park South and suddenly found himself facing ballooning renovation costs—right as the building imposed an assessment for upcoming capital improvements. His question is one I hear often: “How much money can I get back if I renovate?” The truth is, there’s no simple formula. Manhattan is one of the hardest markets in the country when it comes to fix-and-flip valuations. Certain pockets of Brooklyn may offer more predictable upside, but Manhattan plays by its own rules. UrbanDigs’ John Walkup tackled this subject beautifully, analyzing renovated versus unrenovated sales, why buyers overwhelmingly gravitate toward move-in-ready homes, and how to identify a genuine value opportunity.

The numbers help frame the conversation. Renovated apartments currently command a 19% premium over unrenovated units. During the post-Covid rebound, that spread surged to 32%, while the 10-year average sits closer to 14%. It’s a classic convenience premium—similar to paying extra at the corner bodega instead of driving to Costco. Buyers today are willing to pay more for a turnkey apartment because it eliminates the stress, time, and unpredictability of construction. And that’s where the cost—and friction—of renovations comes into play. When buyers consider an unrenovated unit, a laundry list of concerns immediately hits them: unpredictable construction costs driven by supply-chain volatility and tariffs; the challenges of navigating permits and the DOB; extensive building approval processes requiring alteration agreements, architectural plans, engineering work, and various fees; and inevitable board oversight, where building architects review plans at the buyer’s expense and often push back on materials or scope. On top of all this, buyers must continue paying their mortgage, taxes, and common charges while securing approvals and completing the work. It’s no wonder that turnkey apartments remain the preferred—and higher-priced—choice.

That said, the right renovation, done strategically, can create meaningful value. The key is approaching it with data, discipline, and a clear eye toward resale. The goal is to find the right property—one with good bones, the right line in the building, and past sales that demonstrate true post-renovation upside—then renovate with purpose. Buyers will not pay more simply because someone else overspent. If you buy a $500,000 studio and put $500,000 into it, that doesn’t make it a $1 million apartment. The market sets the ceiling, not the renovation budget. That’s why renovations must be cost-effective and thoughtfully executed. Look at historical comps to understand whether previous sellers were able to recover renovation costs. Study how long comparable units sat on the market and whether sellers had negotiating room. And when you renovate, stay price-conscious. You don’t always need a designer if you’re updating a kitchen or bath; you can take inspiration from Pinterest and focus on clean, timeless finishes that appeal broadly and protect resale value.

Renovating in Manhattan isn’t easy—but with the right strategy, the right property, and the right budget, it can deliver both personal enjoyment and real financial return. The goal is to design a home you love while avoiding over-investment in areas the market won’t reward. If you’re thinking about buying a value-add opportunity, considering a renovation, or simply want to understand the potential upside of improving your current home, I’m always here to help. I can walk you through comps, renovation budgets, resale expectations, and the numbers that matter most so you can make clear, confident decisions. Here’s to finding the right opportunity—and creating something exceptional.