A concrete driveway is exactly the sort of home improvement that looks like it should increase the value of your property.
A smooth, stable surface for driving up to your property, a visual improvement to the overall effect of the neighborhood, and a mark of increased affluence for both the house and the area.
You’d expect all of this to add value to your property – but does it? And if so, how much value? And if it adds value to the property, does the amount you pay in property taxes automatically increase too?
Let’s take a look.
Does A Concrete Driveway Increase Your Property Value?
OK, if you’re looking for the TL;DR answer, then yes – the value of your property will increase if you pay out for a concrete driveway.
After all, it’s both an aesthetic and a practical enhancement of the property – very few people would actually do it if it weren’t, and if it didn’t add value both to their experience of the property and its resale value.
Quite how much value it adds to the property will depend on a rag-bag of factors. Where in the country you live, the quality of the workmanship, the nature of other homes in the area, and – most unpredictable of all – the state of the local and national property market.
If your house is surrounded by other houses, all of which have concrete driveways, you might get a relatively modest increase in your property’s value, because buyers will look around and have a “So what?” reaction – you’ll just be coming up to their mental version of “code” for the neighborhood because there will be concrete driveways as far as the eye can see.
If, on the other hand, none of the local houses have a concrete driveway and you put one in, you might well see a much more significant bump in your property value, because potential buyers (and therefore property value assessors) will notice the improvement you’ve made to your property above and beyond what it normal for the neighborhood.
You’d expect to sell the property at a premium because it includes such an aesthetic and practical advantage compared to similar properties in the area.
If you decide to do it, taking a look around the neighborhood at how many houses have something similar may well factor into your decision as to whether it’s a thing that will just bring you up to the local standard, or a thing that will help your property stand out.
It’s also worth noting that despite being a particularly attractive surface from which to make a driveway by virtue of its hardness and smoothness (compared to the likes of brick or cobblestone), it’s also relatively budget-friendly as a surface, being significantly easier to create and source than other kinds of driveway materials.
If you need additional reasons to strongly consider it, concrete is more reflective than some other driveway surfaces, meaning you can either reduce the number or reduce the wattage of illuminating outside lights.
And both this potential energy saving and the relatively ecological way concrete is made makes adding a concrete driveway to your house quite a green upgrade to the property.
You’d probably need a realtor with a good deal of chutzpah to sell it that way – but then if you don’t have a realtor with a good deal of chutzpah, you probably don’t have the right realtor.
An easier way the realtor would sell it – and a factor in bumping up the property value of your house – will be that once you put in a concrete driveway, it will continue to be an improvement to the property for decades to come.
Concrete frequently lasts over 20 years, compared to the likes of asphalt, which can start to tire and crack after 12 years or so.
So, Does A Concrete Driveway Increase Your Property Tax Liability?
Well, yes. Anything that can be proven to be an aesthetic or practical improvement to a property will raise its value (though as we’ve said, the degree to which it does so can vary according to a number of factors).
Any increase in property value will result in some increase in property taxes.
Obviously, if the driveway still exists as and when the property is sold, you will be able to get a higher asking price for the property, though whether the amount of that asking price increase amounts to the price of having the work done plus the increase in taxes is likely to depend on the rest of the neighborhood, the state of the market, and the chutzpah of the realtor.
Roughly What Would It Cost To Add A Concrete Driveway To Your Home?
This might be a frustrating answer, but of course it depends on the size of the driveway. A fairly standard driveway is around 600 square feet, and between materials and labor at the time of writing, you’d be looking at between $3,500-$4,000 to get a brand new concrete driveway poured.
So your property value goes up by about $4,000?
No. You didn’t really expect it to be that simple, did you? This is the US Government we’re talking about.
The property value of your house will probably be assessed as lower than the likely retail value of your house.
Not entirely, but not least, because of the fact that the retail value of your house can fluctuate according to the ups and downs of the property market.
In any case, having $4,000 of work done to your house probably wouldn’t equate to an increase of $4,000 on your property value – though depending on the market and the realtor, you might get more than $4,000 of additional income from the eventual sale of the property.
Calculating Your Property Tax
Your property tax in any case is based on two factors – your assessed property value and the local tax rate.
You might want to strap in for this part.
The local tax rate is based on what’s called millage. And of course, your millage may vary.
Usually, one mill is equal to one-thousandth of a dollar (or a tenth of a cent, if you prefer). So if your local tax rate is 15 mills, then you’d pay $15 for every $1,000 of property value.
That means that in this example, a house with a property value of $100,000 would have a property tax of $1,500.
Even if the assessor that valued your property with its new concrete driveway decided it added $4,000 of real world cash to your property value, you’d only be looking at a property tax increase of $60 – $15 for each additional thousand dollars of property value.
Bottom line – you only live once, but you park thousands of times. Be good to yourself and get that concrete driveway.
By comparison to the pleasure of using the driveway, it’s going to cost you only peanuts in additional property tax, and it might well significantly increase your retail property value if and when you sell.