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Aug
23

Is it Better to Move or Remodel a Home?

Your life has changed since you bought your current home – you’ve run out of closet space, toys are everywhere, your family is tripping over one another. It’s official…the house is just too small. So, do you buy something bigger – or do you remodel the house that you are in? Here are some factors you should consider before deciding whether to move or remodel a home.

Location, Location, Location

  1. You can always upgrade a home, but what you can’t change is its location. If you like your view or you have neighbors who are irreplaceable, then remodeling may be right for you.
  2. You also need to determine whether the costs of remodeling will make your home the most expensive house in the neighborhood. See what homes in your neighborhood are selling for, or ask a realtor to give you a competitive market analysis (CMA). It’s not usually the best idea to put more into your home than you will ever be able to get back.

How involved is your remodel?

Is it better to move or remodel a home?
  1. You need to determine if you have the required space to expand your home – If you will need to add to your existing structure in order to create extra space but you don’t have the real estate for an extension, then buying a larger home is the only option.
  2. But if you have an existing space (an attic, a basement, an enclosed porch) that you could remodel, it may be a cost-effective way to achieve the additional space you crave – depending on how detailed you want to get and the upgrades you choose.
  3. Get some estimates and make sure that you can afford to make the needed renovations.

The Complications of Moving to a Larger Home

Is it better to move or remodel a home?
  1. If you are like most people, you will need to sell your current home in order to purchase your next home. Will you be able to sell your home at a price that will allow you the necessary funds to buy a larger house? Do you have enough equity in your home?
  2. Mortgage rates are still very low – this could allow you to potentially get a larger mortgage than you are paying now, yet have monthly payments that are not significantly different than what you are currently paying. However, it’s still not so easy to obtain a mortgage. You will want to be sure that your credit is good.
  3. Remember that a larger home doesn’t just mean a larger purchase price – it also typically means higher taxes, higher electric bills, higher heating bills, and more maintenance. Make sure that you can afford all of these extra costs.

So, if you are serious about getting more space, talk to a realtor, bring in a contractor, and crunch all the numbers. Then sit down as a family and make your decision together as to what is the best option for you.