Will renovation always increase the resale value of a house?

Well, if owner himself carry renovation work in order to make it more user friendly and to upgrade with advanced products and technology then definately such expence is justified but if the intention is to increase its marketability for resale then such expence wll only increase the cost. as it is the general observation that such property buyer always expects lower market rates and is willing to spend at later stage as per his own personal choice. hence smaller scale renovation like general cleaning, painting, correcting plumbings etc. is advisable to attract more buyers but total rehauling with speculsting comfort rquirements of an unknown buyer is total uncalled for.

Hence answer to this cureent debate is definately NO.

I am not personally familiar with the Indian residential market...and whereas I quickly acknowledge the significant cultural differences, I do have considerable experience with residential construction and marketing in Europe, the US and Latin America...where there is considerable market research on just this same subject.

Typically, improvements made which ameliorate adverse functions and even appearances and which update features and services will see some kind of a return on your investment.  However, you should always consult with professionals (e.g., architects, contractors, designers, realtors, lenders, etc.) beforehand in order to determine what sort of renovations are likely to improve the chances your will property will sell (at all), will sell more quickly and/or will sell at a higher price.

Likewise, such a prior consult may help you understand just which sort of improvements or renovations are likely to give you the best return on your investment.

However, regardless of socio-economic, cultural and/or geographic differences there are always things which you "could do", but which are not likely to improve the marketability of your property...and which, in fact, may detract from its marketability.  Just because "you" would want it (or not want it) in your home does not mean you should automatically consider it (or not consider it) as an improvement option.  You have to be very careful not to invest in "things" (including features, functions, products, materials, colors, finishes, etc.) which only appeal to very few other people.  Your re-finished property may end up being a "masterpiece" to you and a few others, but considered a "White Elephant" or worse by the marketplace.

Finally, regardless of what "tastes in the marketplace" dictate, you need to be careful that, by investing in renovations or improvements, you do not over-build your particular market.  Again, prior consultation should help you in this regard.  Talk with those professionals in your area who can help you understand the economic realities (statistics) of your market.  For example, if the properties in your area are currently selling for 1,000,000 rupees (maximum)...no matter what...and your property has a current estimated value of 900,000 rupees, then it just doesn't make sense at all to invest another 200,000 rupees in new improvements.

Good luck in your venture!