Should I Remodel?

By
Real Estate Agent with Conroy Marable andHolleman / Coldwell Banker

Should I remodel or look for a larger or newer home?

 

One of my biggest pet peeves in buying a home is to never purchase the most expensive in the neighborhood. That same rule applies to doing a major remodeling to a home.  Some homeowners are under the impression if they spend $25,000.00 on a remodeling project, they will recoup that investment when it is time to sell.  Two things occur, 1. It's rare you can recoup 100% of the original investment 2. Major remodels often price the home at the very upper end for that area. As a result, the home owner is stuck with the fact that to sell they are going to lose money and in some cases could even hurt their chances of finding a buyer. Often home improvements are done to suit the present owners' lifestyle, and a prospective buyer may not value the changes as much.

                                               

It's great to improve or redo your home to your liking, but please keep in mind the average time to own a home is five years.  Ask yourself will I be able to get my investment out when I sell?

Comments (6)

Tina Gleisner
Home Tips for Women - Portsmouth, NH
Home Tips for Women

Wow, with some many ActiveRain folks posting each January about the top remodeling projects & what home owners are likely to recoup on resale, I'm surprised to see this post. I would think everyone here is spreading that information around, or maybe they need a piece of marketing collateral to get the information out ... hmmm, seems like a good idea for Assn of Home Professionals.

 

PS Here's my version of the 2008 Cost vs Value Remodeling Trends, written back in January (I don't usually include links but this one makes sense) ...

Sep 10, 2009 06:52 AM
Theodora Wu
TJ Investments - Burien, WA

I have found that if I am going to have what I really want,  I would either have to build it or remodel.  Looking for another house has not worked out well, nothing seems to come any closer than what I have already found.  I have lived here now over 10 years and plan to remodel soon.  In our neighbor even after remodeling our house will not be the best house on the block.

Sep 27, 2009 05:23 PM
Steve Thompson
Steven G. Thompson, Architect - Doylestown, PA

    Should I Move or Remodel My Home?



    If you like your neighborhood but the home you are living in does not meet your current needs, you may be considering whether to buy a different house or remodel your current home. There are many different emotional as well as financial factors involved. How do you decide? 


Five Reasons to Consider Moving.


1. You would like a better school system for your children or a shorter commute to your job.


2. You don't want to make stressful decisions and deal with the long and inconvenient process that remodeling or a major renovation might involve.


3. You own the largest or most expensive home in your area and are unsure if you may have to relocate at a later date.


4. You have a house on a difficult building lot or with a floor plan that may not lend itself to an expansion, without significant expense resulting in a minimal improvement.


5. You want the higher ceilings, a grand entryway and a more maintenance free lifestyle that you believe a newer, more contemporary house will provide. 



Five Reasons to Consider Remodeling or Adding On.


1. You would prefer to have your large landscaped yard with mature trees instead of a bigger newer house in a subdivision that is built on what was once a cornfield.


2. You don't want to make compromises searching for the perfect new home, since often times buying and selling involves making quick decisions you may later regret.


3. You own a medium size home that you can invest in by renovating with energy efficient materials, and expanding with quality improvements that add good market value.


4. You have the patience to improve your current home over time instead of buying new and paying upfront for moving costs, commissions, higher taxes, utilities, insurance and so on.


5. You want the satisfaction of living in a custom home that you have created and which reflects your unique style and individual taste.


    Building an addition to your home can make dollars and cents. Real estate taxes for a renovation, are usually based on the amount of new living space added. In most towns a county appraiser will assess a new addition at the existing base tax rate of similar homes in your area or neighborhood. This means that the quality of interior upgrades or improvements that add value to your home do not result in a higher tax bite.


    Certainly there are other factors to consider. You should do your homework by exploring whether an addition or remodel is a wise course of action. If your home does not lend itself to a remodel, consider purchasing a house that costs less in a good neighborhood with the opportunity for expansion. When looking at a "fixer upper", do not rely on a realtor's guess as to what the feasibility for upgrades may be or how much they will cost. 


    Consider the type of addition that might be best suited for your house. In all cases, fully analyze the renovation potential and probable costs for improving your home by consulting with an architect and contractor team.

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Sep 30, 2009 09:32 AM
Duane West
3R's Construction & Remodeling - Salem, OR

Realy I think your comments were valid to a point but a bit short sided. Not sure where you got your data on five year average between moves? 

Of course unless you spend a long time owning your home after you remodel you will not get your money out of it and lets face it in this market you just plain won't.  I am surprized at how many people look at thier home as a simple investment!  It is a changing world but in this little corner of it people still look at thier home as the place they raise thier kids and grand kids in.  Memories are cherrished and a remodel (however big or small) is about improving the quality of the space you occupy not to improve the marketability of the home.  Granted there are many people who live on both sides of this issue.

 

Remember people see thier home as a personal possesion even after they have sold it.

Oct 06, 2009 08:15 AM
Alex Shekhtman
A&A Design Build Remodeling, Inc. - Chevy Chase, DC
Design Build Remodeling, Washington DC, Bethesda, Chevy Chase

As a design-build remodeling company, one of the questions we ask our clients is: What is your lond term plan for this property? Our advice depends on the answer to this question.

If they are planning to stay in the house for 7-10 years or more, almost anything they invest into remodeling to improve the quality and enjoyment of life, is well worth it. When you need to sell in 10 years, even if you did not recoup the money invested, you at least have a good use of the improvements.

Oct 28, 2009 03:00 PM
Anonymous
remodelingdan

Reasons to remodel

  • Like the neighborhood
  • like your yard
  • like the schools
  • like your homes floorplan/style
  • like your homes location
  • Moving will increase your property tax substantially

Reasons to move

  • Dont like your neighborhood
  • Dont like your yard
  • dont want the "adventure" of remodeling
  • Dont like schools - need better schools
  • dont like your homes floorplan/style
  • Your home is already the biggest/nicest in the neighborhood
  • Dont like your homes location

For some people the decision is easy for others - it helps to have some information like the cost to remodel, the cost to buy and move to the house that would meet your needs and your feelings about your options.  There is a cool online calculator that is free that homeowners can use to figure out the cost to remodel and the cost to move and get a recommendation to remodel or to move.  The calculator is at http://www.remodelormove.com/login.cfm

 

Mar 15, 2011 08:38 AM
#6