Does adding a bedroom guarantee significant home value increase?

[Kristen G.]

We are planning to do a cash out refinance soon on our SFH at 80% LTV to get as much cash out as possible to invest in our first rental investment property. We have a 4BR 2B, 1800 sqft home in Waltham, MA, and considering finishing our expansion attic to add a 5th bedroom and approx. 460 sqft living space.

Before we move forward with finish the attic, we are looking to find out how much value this would add to our home. We have looked at comps in the area, but it has been challenging to find clear differentiation between 4BR and 5BR homes with similar square footage. 

Does anyone know if there is a better way to evaluate this potential project? Is it possible for an appraiser to provide an estimated appraisal based on the proposed work?   

Thank you! 

[Aaron K.]

@Kristen G. you likely won't get much if any value from a 5th bedroom almost all of the value would come from the additional square footage, not to mention that most converted attics require lower and slanted ceilings and don't always have easy access to the rest of the house, if you were planning on doing it just for financial reasons it will probably be a net loss.