Split question about purchasing a home and it's resale value...?

You may see a 60% - 80% return on kitchens and baths... or you may see nothing. It will really depend on what other similar homes are going for when you go to sell. Obviously, the longer you stay in the home... the better. Don't do any upgrades for at least a year... after that you'll know what's most important to you. Don't over-improve for the area. If no other homes have granite in the area... then it's not going to offer you much of a return when you sell. I've got a relatively small home as well and am selling quicker than I expected (due to an inheritance that will now allow me to build in one of the nicer areas in town). I purchased for 64900 three years ago and am under contract for 67000 (listed at 69000). I put around 7k into the home over the last three years because I had planned on staying longer - adding additional cabinets and counters to the kitchen, refinishing both decks, adding guttering and shutters, building a privacy fence, adding rails to the front and back decks, adding additional cabinetry to the laundry area and bath, etc... obviously, I'm seeing a very low return - but, that's my choice for choosing to sell so soon. If you think you'll be in the place for 5-10 years, I would suggest doing the upgrades that you can afford and that make you happy... just be careful not to go all granite if everyone else in the neighborhood has laminate. Good luck to you and congratulations!