Consider the Return on Investment when Planning a Home Remodeling Project
By Mark J. Donovan
||When considering a home remodeling project it is important to understand upfront how it will impact the value of your home. If your home is already priced at the high end in your neighborhood then adding a home addition or investing in a major home remodeling project may be risky from a return on an investment standpoint. If on the other hand you have one of the smaller homes in the neighborhood adding an addition or remodeling the kitchen may pay off handsomely for you down the road when you sell the home.
To better understand what your home may be worth after completing the home remodeling or addition project you may want to talk to a real estate agent first. A real estate agent can do a competitive market analysis (CMA) on your home.
When they do the CMA they can include “comp” homes that are similar to your home before and after the home renovation. You can then take this information and compare it to the actual costs of the home remodel or addition to see what the return on investment, if any, will be.
|Also carefully consider your home addition or remodeling design plans. Make sure that they are aesthetically attractive to the rest of your home and the neighborhood.
For example, from a return on investment standpoint you wouldn’t want to renovate the exterior of your home to look like a colonial style home, in a neighborhood filled with contemporary style homes. You’d be doing a financial disservice to both you and your neighbors.
If on the other hand money is no object, or you plan to live in the home a long time, or your family really needs the space, or the home absolutely needs updating, then by all means make the investment and tackle your home renovation.
For help on building a home addition, see HomeAdditionPlus.com’s Home Addition Bid Sheets. Our Home Addition Bid Sheets provide you with the knowledge and information on how to plan a home addition project, and what to look for when hiring contractors. They also include detailed cost breakdown tables and spreadsheets for estimating your own new home addition building costs.
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