Discover if you should move or remodel by reading this guide.
After a while, you may realize that your house doesn’t have everything you need or want. Perhaps, it lacks a playroom or first-floor laundry. Perhaps, it is too small for your expanding family. If you’re unhappy with your current home, you have two choices: renovate it or buy a new home that meets all of your requirements. Everyone has a unique home, budget, real estate market and priorities. So, the answer to the remodel-versus-sell debate varies depending on who you ask. However, if you’re trying to decide for yourself, follow these five key steps.
Which one should you do?
Evaluate the costs
Cost is a major factor in many Americans’ home improvement decisions. It depends on your current mortgage situation as well as how much money you have in savings to determine whether it is cheaper to renovate or sell. Renovations have immediate, out-of-pocket costs, whereas moving can save you money now but cost you a lot more later. Here’s a list of things to consider when breaking down the cost:
- Cost of selling
- Agent commissions
- Moving costs
- Minor repairs
- Cost of a new home
- Upsizing costs
- Costs of remodeling
- Permits
- Architectural plans
- Materials
- Labor
- Additional expenses (hotel rooms, eating out, etc.)
- Hidden costs (in case anything goes wrong)
Determine your emotional attachment
Your family may be more attached to your home than you realize. It could be where your daughter took her first steps or where you last saw an ailing grandparent. Consider the emotional implications of moving, both for you and your other family members, before deciding whether you are prepared for the stress (and it will be stressful!). Here are a few things you may want to consider:
- Kids: You live in a desirable school district, and your children have nearby friends and activities.
- Sense of community: You like your neighbors and have a good relationship with the community, which can be difficult to find.
- Distance to work: Your commute time is short, and relocating may necessitate a longer commute.
- Activities: Your favorite restaurants, shops, parks and activities are all nearby.
- Family: You have family nearby that you rely on for child care or care for an elderly relative.
Research the real estate market
Even if moving is less expensive than renovating, will you get the most out of your investment? Before you list your home, conduct some market research. Seasonal house selling trends must also be considered. Homes sell more quickly in the spring and summer, and they are more likely to sell at or above the asking price. When deciding whether to sell or renovate, consider your local real estate market and even your specific neighborhood. It may make more sense to sell if you live in a hot real estate market. Here are a few methods for assessing the state of your market:
- Investigate the area: Recent comparable sales should help shed light on what you can expect to get for your home.
- Examine your home’s marketability or buyer appeal: Does your house require extensive repairs before it can be listed? Even in a seller’s market, a well-maintained home usually sells faster than a fixer-upper.
- Speak with a representative: An experienced local agent can provide you with an expert opinion on the value of your home.
- Consider the area you’ll be relocating to: If the value of your home has increased significantly but you want to move to a new house in the same neighborhood, keep in mind that the value of those homes has increased as well, so your equity may not go as far as you think.
Consider the timing
Moving is not only stressful, but it is also not always feasible or rational given other life events affecting you and your family members. Consider that moving may require you to change school districts, commute routes and mortgage payments. Remember that renovating your home incurs immediate costs, with the average home remodel costing $46,503. Can you afford a costly renovation right now if you’re saving for college or other expenses, or would it be better to take advantage of your equity and sell for extra cash?
Except for an unexpected change in the close date, the timeline is pretty much set when you decide to move and once you get an offer. Observe your local real estate market to get a sense of the average time it takes to sell a house. The biggest unknown is usually how long it will take to receive an offer. When your home is under contract, you should be able to predict the closing date with reasonable certainty. However, remodeling necessitates more patience and flexibility. Your contractor may tell you that the renovation will take eight weeks, but they may end up extending it due to changes, issues, or delays.
Be realistic
It’s easy to believe that remodeling will fix everything you don’t like about your house, but it’s not a magic bullet. Some things are simply unfixable by renovation. Here are some things to remember:
- Neighbors: If you have noisy or disrespectful neighbors, no renovation project will make them leave.
- Unfavorable school district: If your children attend public school, they must attend their neighborhood school unless a private school is an option.
- Home type: If you live in a condo but need a single-family home with a yard and a garage, a renovation will not solve the problem.
- Square footage. Adding square footage to a home can be expensive — and that’s assuming the city will allow it and your lot is large enough. Moving may be more cost-effective if you require a much larger home than the one you currently live in.
If you want a top-of-the-line, luxury, or custom home, you should think twice about renovating your current home because there is a financial risk in over-improving your area. Unless you live in a high-priced neighborhood, you can easily over-improve your home, which means you’re unlikely to recoup much of your investment when you sell it. If you want that high-end home and can afford it, you might be better off moving into a luxury home in a market that can support the price. However, if you do decide to remodel your home instead of moving, Valor Home Services is here to help. We are the top stress-free contractors in the area that focuses on bathroom remodeling, basement finishing, kitchen remodeling, door installations and other small carpentry projects. For more information, give us a call today.
