When to renovate – and when not to

The prospect of renovating or remodeling a home can be exciting but it’s often wise to take a step back and consider it thoroughly. Sometimes it’s more prudent to wait and sometimes it’s wiser to postpone it indefinitely – if not completely.

First of all, consider the expense. It’s almost guaranteed that a big project will cost more than the the original estimate, especially if contractors are involved. If you’re looking to significantly increase the value of your home, make sure the return will justify the expense.

Secondly, projects are going to be disrupting. Just how long is it going to take to put in that new flooring? Of course, the complexity of the project will determine how long it will take, but take the time to consider how long life will be turned upside down.

Finally, it all comes down to: is it worth it? Unless the answer is an unequivocable YES then why not wait and consider the ramifications more thoroughly.

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Adding value through special features

When looking to add value to your property it’s important to know what features are attracting potential buyers now.

  • Kitchen island: A well-designed kitchen island changes the look of the room entirely, often making it appear larger than it actually is as well as greatly improving the functionality of the space.
  • Granite countertop: Beautiful kitchens are a strong selling point these days and nothing is impressive as a granite countertop.
  • >Walk-in closet: A popular feature requested these days by home buyers, a well-designed space that accommodates additional cabinets and drawers will certainly add value.
  • Swimming pool: Back in vogue, a swimming pool is again seen as a real plus for outdoor gatherings.
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Remodeling Pays in the Bay Area

According to Remodeling’s 2017 Cost vs. Value report renovation projects inthe Bay Area generally have a high payback percentage with approximately 3 out of 4 showing a return exceeding 100 percent.

Jobs such as adding manufactured stone veneer, a replacement garage door or attic insulation can bring a return of 190 percent, depending on the region.

Analysts expect remodeling to continue strong in 2017 both as a result of rising mortgage rates, which will induce many homeowners to renovate rather than purchase a new property, and also price appreciation which will increase home equity lines of credit for many.

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Renovating and Selling or Renovating and Staying

As we’ve mentioned recently – see More Equity = More Remodeling the current improvement in the economy and overall consumer confidence has led more homeowners to consider remodeling and renovations. For many, the next is “Now what? Do I remodel and sell or remodel and stay?”

Of course, each situation is unique but some general considerations might include:

Renovate and sell

  • Your family needs have changed. This is probably the biggest reason for selling and moving: either you need more space or it’s time to downsize.
  • The neighborhood no longer fits your needs. Perhaps you need a neighborhood that’s more kid-friendly or has better schools. Or maybe these are no longer prime considerations.
  • Affordability. Have local costs become too expensive?

Renovate and stay

  • You love your home. If your current home and/or location is ideal, why change? Make the necessary changes as needed and continue to enjoy your situation.
  • The cost of selling and moving. While your current home has no doubt appreciated in value, so has everything else so it all becomes relative. Add in the costs of selling and then moving and it may just make more sense to stay put.

And, of course, situations change and while it may not be the time to sell now who can tell what will happen done the road?

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Remodeling An Aging Home

A new report by the Department of Housing and Urban Development states that about 66 percent of owner-occupied homes in the U.S. were built prior to 1980 with 40 percent constructed before 1970. Currently the median age of owner-occupied homes is 37 years old. Newly constructed homes built after 2010 comprise only 2 percent of the housing stock in the United States.

The National Association of Home Builders sees these statistics as a huge potential boost to the remodeling industry as older aging homes require renovations and upgrades, particularly in areas such as energy efficiency where they lag significantly behind new construction.

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Remodel, Increase Value – and Stay?

Houzz & Home reports in a recent survey that , fifty-three percent of home owners in the United States say they are remodeling their homes to increase value – but are planning on staying in these homes for at least the next five years. Meanwhile, sixteen percent of those remodeling plan to sell their home in the next two years. Twenty-two percent insist that home prices are increasing at too fast a rate to even consider moving. Finally, one in four say they would prefer to move, but remodeling their home makes much more sense at the present time.

The most popular remodels are kitchens and bathrooms while replacement projects include flooring/ceiling/panelling as well as windows/doors and roofing.

Homeowners in the Northeast and the West typically spend more on their renovation and remodel projects.

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