Putting pen to paper can give you an idea of whether you should remodel your existing home or move.
Steps:
- Determine what remodeling projects you want done.
- Get estimates from contractors.
- Ask a realtor what your current home value is and what it would be after remodeling.
- Subtract remodeling costs from your house’s remodeled value.
- If this figure is more than your current home value, remodeling is probably a good investment.
- Compare your current monthly mortgage payment (plus payments on a home improvement loan, if applicable) with that of a new house.
- See whether you would pay more monthly on your remodeled home or on a new home.
- Make a decision based these investment and monthly payment factors.
Tips:
- Add value to your home by remodeling kitchen and bathroom. “Great rooms” and luxury bedrooms are a current fad for buyers.
- Remember hidden moving costs such as realtor commission, closing costs and movers.
- Avoid making a decision on financial factors alone. Personal factors (attachment to the neighborhood, commute, schools, uprooting your children, etc.) are important.
Warnings:
Always consult a realtor before remodeling. Your house’s value is greatly dependent on the value of the houses around you.
