Should I Remodel My House or Just Move?
Most people will come to a fork in the road with their home at some point, when they realize the home is no longer meeting the needs of the household. Choosing whether to move or remodel is a complex decision, with multiple factors involved and no one-size-fits-all answer.
To help you determine whether you should remodel your existing home or being the search for something new, we've highlighted a few things to keep in mind.
Decide What's Missing
Before making any decisions, determine what you're missing in your existing home. Make a list of specific pet peeves you have with the home or areas you feel your household has outgrown it. Some examples might be:
- Too few bedrooms or bathrooms
- Not enough kitchen space
- There is now a need for a home office space
- Wishing for a home gym, playroom, workshop, or other unique dedicated space
- Unused space, too much upkeep for unneeded square footage or bathrooms
- Too much or not enough outdoor space
- Walkability, good school districts, or other location-related details
Compare the Cost of Moving to the Cost of Remodeling
As with many things in life, the bottom line is the bottom line. In some cases, remodeling will be more cost effective than selling and buying, but the converse may also be true in other cases. To figure out what will cost you more, here are some things to consider.
In general, it costs sellers about 15% of the sale price of a home to sell it. This includes agent commissions, repairs, and title insurance. In some cases, capital gains tax will also apply.
Costs associated with buying a home include 3%-6% in closing costs, furnishing the new home, home appraisals, and the potential for overlapping mortgages if you end up paying on both for a month or more.
Remodeling costs will vary significantly based on the project you take on. It is typical for a home renovation to range between $18,000 and $77,000. In many cases, this project can be financed via a cash out refinance, home equity loan, or home equity line of credit.
It's also important to consider the non-financial cost of a remodel. With historic construction material and labor shortages, it is reasonable to expect delays in the remodel process. Even before the shortages were a factor in remodeling, the general consensus has been that remodeling can be a stressful or emotional process. Consider whether you will be able to, and want to, live in the home during the renovation and how much time you have to manage the projects.
Emotional attachment to a home is another factor you should take into account. This might make you more willing to put up with the challenges presented by a remodel, or it may drive you to want a fresh start in a new home. Consider how you feel about your existing home and the memories you have in it, good or bad, to help decide if it's time for some TLC or time to move on.
One thing you can not remodel out of your home is its location. If you love your neighbors, your children's schools, or your short commute to work, moving to a new location is a risk you may not want to take. On the other hand, the location may be the perfect reason to look for a new home. If you are curious about how other communities might suit your household's lifestyle, explore your options and imagine how living in another neighborhood might impact your life.
When you're ready to look for a new home, contact us. We have the team of experts you need to find your ideal property in Northern California.