Remodeling Your Home and When to Call it Quits on Investing in Your Home
By Mark J. Donovan
||Historically one of the best ways to increase a home’s value is to invest in it in some way, such as a major home improvement or home remodeling project. Normally the money spent on remodeling your home pays for itself in as little as a few years. In a hot housing market you could actually make money on your freshly completed home remodeling or home improvement project. However, in a bad housing market, it could take many years to recoup the cost of a home remodeling project. In some cases, you may never recover your investment. So how much is too much when remodeling your home? That’s a hard question to often answer in many situations, as it depends on numerous factors. Summarized below are some things to think about before investing in a new home remodeling project.|
Type of Home Remodeling Project Matters
First, what type of home remodeling project are you considering? Kitchen and bathroom remodels typically have a high return on investment and short recovery times. Similarly, you might be surprised to learn that landscaping has a high return on investment. Family room additions and sunrooms, on the other hand typically don’t have high ROIs.
Basement remodeling and attic conversion projects also can have reasonable return rates, if they are not overdone with significant custom features and materials, and do not require any exterior construction work.
|What is the Surrounding Neighborhood Like?
Creating a massive home by adding on to it a large home addition can price the home outside the normalized price range for your neighborhood. Consequently it may be impossible to recoup your home remodeling investment, particularly if the project includes many custom features or uses high end materials.
The best bet is to talk to a local real estate professional prior to deciding on a large home remodeling or home addition project.
They can tell you what your home will be worth pre and post the proposed home remodeling project. You can then compare the cost of the home remodeling project to the new value of your home when the project is completed. Thus you can make an informed decision.
Similarly, making small home repairs or painting the interior walls of your home cost very little and can make a huge difference in your house selling or not.
|Pools are Sink Holes in Many Cases
If you live in a northern climate there is a high probability that installing a pool on your property will do little or nothing to the value of your home. As a matter of fact, it may lower the value of your home and/or prevent the sale of it. Many prospective home buyers simply don’t want to have to care for a pool, nor pay the cost of getting rid of it.
So consider all of these issues prior to investing in your home. Often you may come to the conclusion that you’ve invested enough already or that a particular project is not worth the investment and effort.
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.
- How to Sell Your Home Quickly
- Top Considerations when building a First Floor Addition
- Five Types of Home Additions
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