Frankly, unless you have the money and time (both the time needed to plan, obtain permits, and construct AND the time needed to sell in a less densely populated market) to renovate the home, it doesn't really make sense to increase the home's square footage before sales. In fact, my personal opinion is that at a price of $5 million, buyers would prefer to find a "fixer upper" at half the price with the possibility or renovating a home to suit their personal style later.
In fact, most of my high-end buyers (those looking for homes priced over $2.5M) have such specific desires and such a specific list of "must haves" for their homes that most would prefer a good "lot" with building possibilities versus a home renovated for the current owner's needs. Unless you are a developer, interior designer or someone with a great sense of current housing trends, you risk the possibility of building or renovating in a manner that fails to recoup the investment.
So my suggestion is to keep the home for as long as you want it, then list it "as is" with the knowledge that the new buyer will, in all likelihood, be making changes to the property after the close of escrow. In the meantime, you save yourself the time, expense and risk of renovations to your home.
Allison James Estates & Homes
Tel (408) 426-1616
Buyer Rebates up to 50 percent of Commission, Low, Low Cost Listings to Sellers