There was once a couple who bought a home built back in the 60's. When they bought the house it was a 4 bed with the original pink bathrooms, dated kitchen and retro appliances which at the time was all they needed and worked out fine. Dream home, not quite, but it was perfect for there use as a young couple.
Six or so years later and now the couple has three children, some pets and feels like its about time for an upgrade as their current space isn't able to handle their growing family. As almost anyone would do they start the search for a new home with the thought of major construction sounding a bit scary. They looked at probably a dozen homes and couldn't believe what they were getting for the price of the home considering they would also require a serious investment in renos.
After seeing whats out there they decided to go ahead with doing the renovations in the current home as after all, they loved the neighborhood and location and with buying a bigger home comes higher property taxes so it made sense to stay put and renovate. This allowed the couple to create the dream home they always wanted and not have to undergo relocating.
After a complete gutting and reconfiguring the house they added another bedroom and bathroom and an additional 1000 sq. ft of living space making all the main areas seem far more spacious. After replacing the siding and repainting the finish, it looked as if it were a brand new home and not something that came from the 60's and at the end of the day it cost less then buying a new home.
Before making the decision to love it or list it, experts suggest you ask yourself these questions.
How long have you been living in your home?
You should consider waiting three to five years before selling as typically it's around the three-year mark when you break even when you consider costs such as real estate commissions and other moving expenses. As well, property values will typically go up during this time, improving the value of your home.
Did you think about the reality of renovations?
Renovating your home can be very time consuming when you factor in inspections, waiting for permits, picking out what you want and communicating with the trades. On top of being a long process it can also be a very expensive one, and at times, more then you thought. Before taking on a renovation you should leave an extra 20% on top of the estimated cost to allow room for those unforeseen costs.
Are you going to over-improve your home?
The best upgrades to make are going to be to the kitchen, bathroom, landscape, carpet, and paint. The value of your home is based on the comparables in the neighborhood so you should be careful to not do so much work that you home far exceed's the value of other homes in the neighborhood as you're going to be less likely to fully recoup the costs when you sell.
Do you like your location?
Do you have kids that love their current school or how conveniently close you are to everything? Or are you on the other end of the spectrum where there isn't anywhere to park and you wish you could pick up your home and drop it somewhere else. Location is and should be the most important factor to consider when it comes to moving or renovating because after all, you cant just pick up your home and move it somewhere else.
How much can you get the home for?
Talk with a local Realtor who knows your neighborhood as they can give you insight into whats recently sold in the area and what your home is worth. Depending on what the market is like, your Realtor will be able to advise you if now is the right time to sell and help you figure out if the home you have your eyes on is possible for you to afford. Additionally, the right Realtor will be able to advise you on what renos to consider doing and put you in touch with the right contacts to get the job done.
Would you be happy with a face-lift?
It happens all the time where people go to sell there home which requires them to clean things up, paint some walls and really freshen up the place and then they see how much better the house looks and decide maybe its best to stick around after all. It will be beneficial for you when you are thinking about moving, if it's not for the purpose of relocating, to clean the place up, declutter and do some minor work to see if maybe it's possible to salvage what you thought was time to move on from.
Have you truly outgrown your space?
If you're in need of an extra bedroom and can't easily make one into two or don't want to undergo the process of doing an addition then maybe its time to upsize. If you're always feeling cramped in the living areas/halls and their arent anymore walls to knock down then again, maybe its time to think about making a move. However, if your issues can be resolved by doing some work and you like the location then you will be better off sticking around. This is also important to consider if you haven't been living in your home for too long. If you haven't yet outgrown the space and haven't been living in the home for too long but are dreaming of living in an updated space in the same area then chances are you'll be better off doing some renovations.
Idea for article came from Danielle Braff of the Chicago Tribune