Let’s say that the question of whether to become a move-up buyer or to do a remodel is becoming inescapable. For example, are the kids growing up so that each one now needs their own bedroom? Is your home office beginning to feel more like a closet? Or, has it become clear that your home simply doesn’t have the living space that is needed by your family. The key question arises: What are you going to do about it?
The decision to either become a move-up buyer or to remodel your current residence is often a daunting one. Here are some key issues to consider as you try to make this all-important decision.
How Much You Love Your Current Neighborhood?
If you have lived there for sometime, ask yourself, how many great friends do you have in the neighborhood? Do the kids have some close buddies in the neighborhood? How convenient is the current location in relation to your job, or the kid’s school? Even with such considerations, you may simply feel like it is time for a change.
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What Exactly Needs to be Remodeled?
If you want to remodel, the question becomes, “how much remodeling would be necessary?” Simply changing the utilization of space is much simpler and less costly than adding on a room. Room additions can get expensive, and such efforts don’t always yield the best return on investment. For example, in the 2013 cost vs. value report from Remodeling Magazine, a bathroom addition is calculated to cost an average of $37,501. However, it only brings an average of $20,569 in returns.
Anticipate Your Needs in the Near Future
Are you planning to add to your family? Are you hoping to start up a home-based business? Is there a family member getting more and more involved in an avocation that requires much more room? It may be impossible to completely predict the future, but if the “handwriting is on the wall” that increased space will be necessary. Here, it becomes more vital to address the need for remodeling or the need to become a move-up buyer.
Look at the Business Side of the Decision
We already discussed the question of return on investment (ROI) when it comes to remodeling. Understand that, on one level, this is an important business decision for your family. This involves getting a feeling for what’s happening with home values in your area and in the area to which you might move. For example, the fact that interest rates are still low can make this a good time to become a move-up buyer. At the same time, these low interest rates might also make the financing of a remodeling project to be more modest in cost.
If you are in an area with a low real estate inventory, it might be a good time to list your home and to get a good price for it. Looking at price trends in your neighborhood, versus the neighborhood that you might move to is also important. For example, let’s say that prices have risen and are strong in your neighborhood. However, at the same time, the community to which you want to move has not yet experienced the same rebound in the real estate values. In such a scenario, these market conditions could be very persuasive in encouraging a move.
Ultimately, contractors can help you nail down the potential cost of a remodel, and capable real estate agents can give you a better feeling for what price your current residence might bring.
