by Keith Dmytryck
You know your house would go from good to fabulous with the perfect home improvement project: a bright, airy sunroom; roomy two-car garage; sleek, efficient home office; luxurious master suite. You know what you want, you know what you can afford – but now that you’ve done some research, you’re afraid. Why?
You’ve Googled yourself into a maelstrom of warnings. Five Home Improvements That Will Lose You Money! Remodeling Projects That Drain Your Equity! Is Your Dream Addition a Financial Nightmare? Scary stuff. Makes you want to just stay inside your four dull walls and deal with it. Actually, the information is valuable. The problem is (it’s a multiple choice problem), its value depends on
• What study are you looking at? Realtor.org has different results from Forbes.
• How comparable are the study projects to the one you have in mind?
• Are you staying for awhile or just flipping?
• and the subjective “unstudiable” element: What’s your personal cost/benefit factor?
If you’re flipping, your guide is the strict cost/return chart and you’re more in the business category: monetary investment is your only concern.
As a homeowner trying to be sensible about a possible future resale, you have additional investments of comfort, emotion, lifestyle enhancement, and the details of daily living in a structure that is, above all, your home – for the next five, ten, or twenty-plus years. How to sort out the warnings?
Let’s start with a much-loved home improvement project that’s received some grave warnings on the cost recoup front:
It’s like a mini-resort in your home, bringing a sense of spaciousness, light, and the outdoors invited in. That’s very good – even better that realtors tell us potential buyers want square footage and lots of light. But Remodeling Magazine’s Cost vs Value Report from 2012 shows the “average sunroom addition” at around $72,000 with a resale value around $34,000 and cost recouped averaging 47%. Hmm, is it worth it? But wait.
CostOwl.com’s 2012 report gives a huge range of “average costs” for a custom built four-season sunroom: $10,000 to $80,000! They reveal the obvious reason: the range of costs, depending upon contractor, region, and grade of materials ($100 to $400 per square foot) with size range of 100 to 200 square feet. So maybe your 14×16′ sunroom comes in closer to $45,000. If you recoup only 47% at resale, that’s $21,000.
It’s a matter of perspective and your personal priorities. How much will you enjoy it? Will it enhance your life enough to be worth the price? Do you need to recoup the entire cost to make that enhancement worthwhile? You don’t get any money back on a vacation. An average 7-day Caribbean cruise for a family of four is at least $5,000. How about a permanent vacation in your home for $19,000 more? Deal or no deal?
The balanced approach to remodeling decisions is what I recommend, not a one-size-fits-all. With our next blog post we’ll see where it takes us on a few of the projects that lately set off the warning blogs.
Are you contemplating a home improvement project but know where to start or what all would be involved in achieving your goals? For an honest, realistic, thorough assessment of the home improvement project you have in mind contact Innovation Construction Co.
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