Should You Renovate Or Move House?

It’s time for a change when you find yourself paying for utilities for spaces you don’t use, while your teenage children hang out in the garage to have their privacy and your elderly mother hogs the dining room with her bridge club. The question is whether to move and try to find that dream home you want, or to renovate/remodel and adapt the home to your current needs. Use the following criteria to figure out whether you need to find a home builder or remodeler, or build a new home.

Analyze Your Needs

Outline your family’s plans for the next 5 to 10 years. There are always things that happen unexpectedly, but you should have a reasonable idea of your personal goals for the period:

Are you planning to start a family? If so, you’ll need to be close to the schools and extra-curricular amenities you choose for your children. Are those available in your current residential area, or do you need to move to find them?
Will your children reach adulthood and possibly move out, leaving you with an empty nest? Perhaps you’d like to keep them at home longer by giving them their own space with a private entrance.
Are you reaching your retirement years, or do you have aging relatives who you may need to take in? You may need facilities such as bathrooms to be accessible, or to create leisure areas for reading or TV viewing.
Calculating the Costs

Once you have identified the changes you need to make, invite a qualified home builder or remodeler to submit an estimate for the alterations. Determine how you will finance a remodeling project and what the cost of interest on the loan or second mortgage would add up to. Research the market value of homes that offer the options you need in the area you want, as well as the price you can expect to receive if you sell your existing home. Factor in the current state of the real estate market and the likelihood of getting your home sold in a realistic time frame.

Drawing Comparisons

Add the expected value of the renovations to the current market value of your home, to calculate what its new market value is likely to be. Compare this to the value of other comparable homes in the area to ensure that you won’t be over-capitalizing by remodeling. If the final projected value will be higher than the cost of 80 percent of the homes in your street, it’s possible you won’t be able to realize the true worth of the property if you want to sell it in the future. This may not be a problem if you plan to make it your final home until retirement, so consider carefully before making a decision.

Another Alternative

Of course, there’s always another option if you decide you want to move but can’t find the right place, and that’s to buy a vacant lot and build your dream home. Many of these criteria will still apply, such as finding an area that offers the amenities you want and getting your existing home sold at a price you find acceptable. However, your chances are high of creating the perfect home for your family—a home so good you won’t want to sell it, even if you face the same decision again.