The best way I can think of to approach this and to be able to make the most intellligent decision is to take a look at what has been going on in terms of sales (and home improvements) in your particular neighborhood. What have homes that are similar in size to yours been selling for recently (within the past six months)? Are there any homes in your neighborhood that have the approximate amount of finished square footage that your home would have once the basement is finished? If so, have any of those sold recently and did the price they brought give any indications that you could recover the expenditure you are considering making? And looking at it from another perspective, will the improvments you're considering make your home more marketable, allowing you to obtain a better price when you sell at som time in the future?

Despite what is going on with the current real estate market, our area has low unemployment (about 3.2 percent vs. over 5 percent nationally) and is generating around 40,000 jobs a year, according to Stephen Fuller, an economist at George Mason University who keeps tabs on the local economy. Having said that, the future value of your home and what any improvements add to that value is going to be affected by a number of variables. Location is a big one and, generally speaking, the closer in your home is, the more likely it is that it will not only retain it's value but also that it will appreciate in years to come.

A realtor, by researching and providing information on recent sales in your area, can help you answer some of these questions and give you a better idea, and some peace of mind, about any decision you make.

Tue Apr 22 2008, 13:16

If you don't expect to re-coup that money then no, if yes then yes. If your market is much like the rest of the country then it is likely that you will not get the same amount of money that you paid. The improvements will probably make your house more desirable but not more highly priced.

Tue Apr 1 2008, 18:41

If I were you, I wouldn't spend any money now. Do you need the space or are you thinking about resale now? If you need the space, it is understood. If for resale, it is not worth it now.

The period of 5-6 years from now is a long time.

Amal

Tue Apr 1 2008, 18:31

If you're going to be there for 5-6 years, and you've got the money to spend, then do so and enjoy. I don't know where in Alexandria you are, but if it's near Old Town, or in Del Ray, or some similar area, you're probably not overimproving. More to the point, it sounds as if you're doing a number of things right, such as lowering the floor so you have a full ceiling height. And even more important, it's always refreshing to see people improving their homes, and then having a chance to enjoy the improvements. So many people fix their homes us just prior to selling (which certainly is good for expediting the sale), and don't really get a chance to enjoy those improvements.

Recognize that you may not recover dollar-for-dollar what you're investing. But, as I said, if you've got the money, and you'll be there for awhile, sounds good to me.

Hope that helps.

Thu Mar 13 2008, 19:09

K, if you're 'just outside Wash DC' then odds are your house is definitely older. You can't go wrong by adding finished living space, no matter the age. If you're still enjoying your home, then there's no need to sell. The current market is one for motivated sellers only. Ride it out. You can get email alerts whenever a home sells within a mile of you with the link below. At least that way you can monitor the sales and property values until you're ready to sell.

Thu Mar 13 2008, 17:56

K
I would suggest talking with a local Realtor about your plans. I talked with a developer yesterday about his home listed for $1.6 million. It is surrounded by smaller homes. Frankly it is too much house for the street. He will never get what he wants for it. Somebody should have told him.

So I am telling you, get some advice from someone who knows the market before you go crazy. Or go crazy, but do not expect to get what you put in back out when you sell.

Thu Mar 13 2008, 17:12

yes, enjoy the house, the economy should be better in 5-6 years.

Thu Mar 13 2008, 10:28

I agree with Frank. I think that unless you are buying a piece of property specifically as an investment, the primary goal of ownership is to enjoy it, make it yours. You mention that "maybe" you'll sell it in 5-6 years. So maybe you won't? Obviously, the longer you keep it, the more time you have to build equity. But as long as the home has a good frame and foundation, I don't think it really matters that it is 90 years old.

Thu Mar 13 2008, 10:19

It would only be crazy if you think the house might be flattened by a developer. Otherwise, enjoy!

Thu Mar 13 2008, 09:14