Renovating your home is a major undertaking. Not only can it cost a bundle of money, you have to deal with a house in disarray for weeks, months, and in some cases even years! But in today’s housing market, renovating real estate is probably more economical than selling your home, which is netting less and less everyday. In fact, remodeling is expected to reach $316 billion this year alone, and that number is steadily climbing. If you are thinking about remodeling, it is probably a good idea to have your home appraised by an experienced real estate appraiser first, just to make sure it doesn’t make more sense to sell your old house and move into a new one that already has everything you want, especially considering the fact that buying a home is becoming quit a good deal.
If you do decide renovating is the best answer for you, maybe you love the area you live in, maybe you’re attached to your neighbors or maybe you find your home is worth more to you emotionally than you can get monetarily, than it is probably smart to do some research. Before you start spending money on remodeling, which can be a lengthy process, make sure you know what you are getting into. Here are a few things you should keep in mind, if you do decide to improve your part of the housing market.
The first thing you want to do is make sure you know exactly how big a renovation you can afford and whether it justifies the time you intend to spend in your revamped home. And keep this in mind, many banks are starting to freeze their clients home equity line of credit, so if you were thinking about going that route you better check with your mortgage lender first. If you can’t get the money you need that way, you may want to refinance your home. Refinancing will entail a reappraisal of your home by a licensed real estate appraiser who is thorough and will make sure to get you an appraisal that matches the fair market value of the homes that are selling in your area. So, after all that you still decide you want to remodel, well here are some other things you should consider.
How long do you plan to stay in your house after the renovations? This is important because the longer you plan to live there, the more creative you can be. But if you’re planning on selling the house in the next five years, keep potential buyers in mind with your choices. That doesn’t mean you should compromise what you want, it just means that you should go with the tried and true more than the trendy and kitschy. But if trendy is your middle name, why not showcase that side of your personality through your furniture instead of the architecture. This way you can take your trendy investments with you when you leave.
Another thing you want to consider is whether you want to go all out and do a total overhaul on your real estate or just some cosmetic fixes to your home. It’s OK to make small changes one at a time, but think long-term about the next step. For example, if you’re buying a new sink, buy one with enough holes on the deck for the faucet, sprayer and soap dispenser you might want to add on later. (Cutting more holes into stainless steel or porcelain after the sink is installed is an onerous job you don’t want to get stuck with.) And if you know you’re going to buy new cabinets later, don’t replace the countertop with expensive granite now. The chances of reusing it are very slim — either it breaks when you try to remove it, or it doesn’t match the footprint of the new cabinets. And remember, the materials that are hot in the housing market today may not be tomorrow, so again, try and stay as conservative as you can without destroying the integrity of your vision.
It’s also important to be realistic in today’s housing market and understand how long renovations can actually take. A big job can go on for months, so you need to be prepared to make do without that bathroom, kitchen or bedroom. When checking references before you hire your contractor, be sure to ask if the company finished the work on time. You’d be surprised how quickly a week can turn into a month. And no matter how much you like your contractor, a month is a long time to live with strangers traipsing through your home.
Always think about the style of your home and the feeling of the real estate around you. Any big changes you make to your home should reflect what future buyers looking in that area may expect. For example; if you live in a quaint little neighborhood with white picket fences and swings on their front porches, you may not want to upset the housing market in your area by painting the front of your house purple and adding a bell tower, don’t laugh I’ve seen it done. Besides that would make it extremely hard for an appraiser because they base the value of your house on what other comparable homes in your area are selling for. I doubt your quit little neighborhood has many comparables like the one I just mentioned. Real estate is a risky enough proposition, why put yourself in a precarious position?
Maybe you’re thinking about doing much of the renovations yourself. Great, but make sure your ability matches your vision. There’s nothing worse than getting through half a remodeling job only to find out you’re not handy enough to finish it. Not only will that slow down the process, it will end up costing you a lot more money, once you find somebody capable of fixing it.
The housing market is very shaky right now, so I can totally understand why so many people are deciding to remodel the homes there are already in instead of selling it for a loss and moving. That being said, renovating real estate can be a daunting task as well. Make sure you get referrals for anybody you hire to work on your home, come up with a budget for how much you are willing and can afford to spend, and make sure it doesn’t make more sense to sell the home you’re in and buy your dream house by getting it appraised by a reputable real estate appraiser. If all this checks out and you are able turn the home you’re stuck with into your dream home, you will be one of the lucky few in the housing market right now.
If you are considering buying a home, selling a home, refinancing a home or you simply want to know the current value of your home, please visit us at Mahler & Associates for all your appraisal needs.