Remodel, rebuild or move

Asked by Doreen, 08816 Fri Feb 27, 2009

We live in frost area in east brunswick, a 3 bedrooms 1.5 bath 1962 ranch, location is good but house itself just need lots of updating, we changed heater/air condition and have basement finished the tax about 9200, Now, we feel the house is little small for family of 4 plus occasional visiting relatives and need insulation, new window and new siding and ....etc lots of something that all older house need. We are tired to fixing house...our friend said we can either remodeling the house or move to a newer house, so I am wondering which option would be praticle - rebuild which never seen in near by area remodeling would cost at least 90000 and not counting tax, would like to listen view from professional, thank you.

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9
Alan Aly, Agent, East Brunswick, NJ
Sat Feb 28, 2009
Hi Doreen,
It is a good question, and the answer depends on a couple of factors.
>> First decision should be whether you NEED to move or not, and answering that you should consider that it is a great time to buy. In other words you can't say "we can manage for another year or two", as both prices and interest rate are more likely than not to go up and buying a house then may not be within reach.
>> If the answer is yes, we need to move, your next question will be how much work is NECESSARY for the house to sell in a market saturated with inventory. Keep in mind that most home owners would view this differently and ask "if I spend so much, will I be able to recover it?”. Chances are YOU WILL NOT, however this is deferred maintenance to get the property to average condition, and more importantly it could mean the difference between selling or sitting until you settle for a low offer, because it is the only offer.
>> Next question will involve your financial situation, and that question is.. Can I afford to spend $ ... for NECESSARY work and still be able to buy my new home?
>> If yes, then your Real Estate professional can help you decide what work to be done and you would be on your way to a new home, otherwise you will need to remodel and stay.
I hope you find my answer helpful. Have a great day.
Web Reference:  http://www.AlanAly.com
2 votes
John Sacktig, Agent, New Jersey, NJ
Tue Apr 28, 2009
Hi Doreen,

I would look into all options. I would speak to a local realtor to see what your home is worth in the current condition and then look around a the area and see if there is another home you want to move into. Then do the math to see if it makes sense. The current market is a perfect time to trade up! These types of transactions are tricky, but it is totally possible to do.

I know the Frost area very well and I live in the area. I can stop by to discuss further in person if you like!

Call or email!

John Sacktig
Broker / Manager
Orange Key Realty
Office: 732-863-6969
Cell: 732-213-1409

JSacktig@orangekeyrealty.com
1 vote
Thomas And P…, , Hillsborough, NJ
Sat Feb 28, 2009
Doreen,

There is a golden rule : Cost doesn't equal Value. Just because you spend $90K on an addition and upgrades doesn't mean that you can ask for that back when you do decide to sell. I went through the same thing when a handicapped family member came to live with me. Do we spend the $70-80K on converting garage, new bathroom, and everything else that would go with it, or take what we have plus the profit from the sale and buy another house with a floor plan that would mostly accomodate our needs. We decided to sell what we had. Our house was not upgraded completely so we had to make some concessions but it worked out for the best. If you would like I could come and talk with your husband about this and give some tips and other things that can be done. You can contact me through my profile or from the link. Hope to hear from you.

Sincerely

Tom Ellis
1 vote
Bill Eckler, Agent, Venice, FL
Sat Feb 28, 2009
Doreen,

This is a great question.

There are so many excellent buying opportunities in today's real estate market that people in your situation should really take a close look at the opportunities that buying new/different property presents.

You may find that the $90,000 you would spend on remodeling could result in much more value by considering a different home in a different location.

Your best decision may be to remodel but our advice is to consider the buying option seriously before committing to anything.

Good luck
1 vote
Laura Gianno…, Agent, Manahawkin, NJ
Sat Feb 28, 2009
As already suggested get a REALTOR in to see what your home would sell for. Then check with a mortgage rep to find out how much house you can afford if you decide to purchase. Check areas you'd like to live in and see what homes there are selling for.

Also, when talking to a mortgage rep, find out the costs involved to borrow money for a remodel.

Once you have all that info you can make an informed decision on your next step...remodeling, rebuilding or moving.

Good Luck!

Laura Giannotta
Keller Williams Atlantic Shore
1 vote
Filomena Gor…, Agent, Bedford, NH
Fri Feb 27, 2009
I would say that you should have a real estate professional come in and give you an idea of what the home would sell for as is. A home is definetely harder to sell in this market, if it needs a lot of work. Ask the agent what the home might sell for if you did some of the work (I would ask the agent what she would recommend getting done). Then you can decide if it makes more sense to do the work or not. Also checkout what is on the market your budget of home as is and then see what is on the market for your budget of home fixed up.
1 vote
Bryan Furse, Agent, Atlanta, GA
Tue Apr 28, 2009
Without specifics to your situation, it's hard to say for sure. Usually you're better off buying the house you need, rather than making your present house bigger. IF your house is one of the smaller ones in the neighborhood and/or it's not in saleable condition, then you might be advised to do some expanding and/or remodeling. If your home is typical for the area you are in, then you might be better off moving elsewhere. This is because you never want to make your house the biggest or nicest in the neighborhood. If you did, then you would not likely ever get your money back out of the work you did.

My advice: talk to local REALTORS and builders/remodeling professionals and see what each has to say. Keep in mind that money you put into upgrading your house is often money spent, not invested. You have to be very careful how you spend money on a house, if you hope to ever see it again.
0 votes
Kitsap, Both Buyer And Seller, Washington
Tue Apr 28, 2009
Doreen, I know you requested a professional, so pardon me nosing in.

I started down the remodel process. Paid for a design draw up and cost estimate. The problem I worried about, and rightly so, is that eventhough we could afford the cost of the remodel that we "wanted" to do, the neighborhood wouldn't support the cost of it. For example, we could qualify for a spending $300,000 for the major remodel, but an appraiser wasn't going to ever say that at the end of the remodel the home would be worth more than $400,000 in this market and we didn't want to go back into PMI territory.

I ended up paying $100/sq ft for my new house that meets all my wishlist items. The remodel would have been more like $200/sq ft for the new spaces and I would have been giving up some wishlisted items.
0 votes
Doreen, Both Buyer And Seller, 08816
Sun Mar 1, 2009
Thank you all giving me advice and I am really appreciate all, thank you again.
0 votes
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