An age old question in the real estate business is "If I remodel to meet my needs, will I get my money back?" The answer to the question is case by case. Home-owner motivators to remodeling usually include lot characteristics, school district, work commute, and family. Home-owner motivations to relocating are diminishing returns, functional obsolesce in the home, and construction and energy efficiency updates.
Location, location, location is the reason most owners remodel. Once you find the perfect setting for your home, why would you want to move? Desirable lots that have timber, overlooking water, golf view, mini-acreages are not easily replaced. Remodeling your current home maybe less expensive then finding another picture perfect lot. If location is driving your decision to remodel, resale is generally not a concern.
School district is a motivator for remodeling. The schools in our area are nationally ranked with low student to teacher ratios. Many parents are remodeling or updating their homes because there are not building lots or other desirable home's they would consider in their school district.
Work commute is a motivator to remodel for many professions. Several professions such as firefighters, Para meds, and doctors are required to have a short commute to work. If travel time is crucial, updating your current home is a resolution for new home trends.
Hanging your heart at home with family values is another reason to remodel. The phrase "family farm" comes to mind. Remodeling a home that has been family owned can make it yours and more functional to today's lifestyles.
After researching your options, you may learn it is better financially for you to relocate. Lifestyles and the way we live changes. If the home you own has a functional obsolesce, you may never get your money out of a remodel. A few examples would be lack of adequate garage space, basement laundry, or un-used formal areas.
Diminishing returns is another reason for you to relocate instead of put money into a remodel. When a home improvement cost does not make sense, the home can over-progress the neighborhood. An example of this may be a $20,000 kitchen remodel in a $100,000 house. For the $120,000 cost, additional bedrooms and garage size would have been a better investment return. Consult a realtor before purchasing high end upgrades for your home.
Construction and energy efficiency savings are motivators for homeowners trading in their out-dated, high utility cost, and not maintenance free homes. The utility and maintenance cost savings can balance out the increase in a higher mortgage payment.
When considering a remodel, consult the advice of a realtor, home improvement store for recommendations, and a designer. You will want to consider the return on your investment, functionality of floor plan changes, and resale probability.
Heather Morris CRS, GRI, ABR, CLHMS
Broker Associate/ Skogman Realty 2008