Capital Improvement

AAA

DEFINITION of 'Capital Improvement'

The addition of a permanent structural improvement or the restoration of some aspect of a property that will either enhance the property's overall value or increases its useful life. Although the scale of the capital improvement can vary, capital improvements can be made by both individual homeowners and large-scale property owners.

INVESTOPEDIA EXPLAINS 'Capital Improvement'

For example, if Jack buys a new hot water heater and tool shed for his property, both would be considered capital improvements to his house. Similarly, the creation of a new public park in the downtown area would also be considered a capital improvement for the city. In both these cases, the new additions would make the respective properties more valuable.

RELATED TERMS
  1. Betterment Insurance

    Betterment insurance refers to insurance coverage that a tenant ...
  2. Future Capital Maintenance

    A term used to account for future expenses that a company expects ...
  3. Property

    1. Anything over which a person or business has legal title. ...
  4. Flipping

    A type of real estate investment strategy in which an investor ...
  5. Assessed Value

    The dollar value assigned to a property for purposes of measuring ...
  6. Land Value

    The value of a piece of property, including both the value of ...
Related Articles
  1. Personal Finance

    To Rent Or Buy? There's More To It Than ...

  2. Home & Auto

    To Rent Or Buy? The Financial Issues

  3. Taxes

    A Tax Primer For Homeowners

  4. Taxes

    5 Tricks For Lowering Your Property ...

Hot Definitions
  1. Capitulation

    When investors give up any previous gains in stock price by selling equities in an effort to get out of the market and into ...
  2. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  3. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  4. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  5. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  6. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
Trading Center