Love It Or List It: Should You Renovate Or Buy A New Home?
Hanna KielarDecember 20, 2019
I’m currently living through week six of our home renovation and it has me seriously wondering: would it have been better to just move rather than remodel?
When we dove headfirst into a complete overhaul of our home, I was confident we’d made the right choice. Our location is great, we like our neighbors, and we’d get to choose exactly what we want for every detail in the house. But now, after living through a construction zone, I’m not so sure.
Is It Better To Move Or Remodel?
Deciding whether it’s better to move or remodel is something that requires a lot of thought. There’s no one right answer for everyone. When deciding whether you should stay or go, you’ll want to take an honest look at your situation and goals.
- Do you love where you live?
- Are you ready to tackle and manage a long project?
- Are you trying to save money?
Once you know your goals, it’s easier to figure out if it’s a better idea for you to move or remodel your home.
Pros Of Moving
Don’t Have To Live Through Construction
If you’ve never lived through construction, let me warn you now: it is tough. There’s dust everywhere and if you’re tackling a big project, you’ll likely be without your kitchen or bathroom (or both!) for an extended period of time. Trying to cook meals on a hotplate in the corner of a room gets old quickly. And with the average kitchen remodel taking 6 weeks, you may find yourself doing this for longer than is comfortable.
Remodeling Won’t Solve All Your Problems
If you wish your home was in a better neighborhood, had a bigger yard, or was in a better school district, remodeling can’t fix that. When you move, you get the chance to start fresh. Pick a new neighborhood, move to a great school district, or find a home with your dream yard.
Also, your home might just not be the best option for a remodel.
You Can Buy A Turn-Key Home
If you’re not someone who loves the thrill of a new home improvement project, moving and finding a turn-key home is probably a better option. You can move in and not have to worry about spending your weekends at home improvement stores.
Won’t Need To Manage A Renovation Budget
While home improvement shows may make it look easy to stay on (or close to) a renovation budget, the truth is you may very well end up spending more than you expect. One Houzz survey found that 31% of home renovations exceed their budget, while another 31% don’t set a budget. Depending on the length of renovation and the complexity involved, managing your renovation budget can be a time-consuming activity.
Pros Of Remodeling
Moving And Home Buying Is Expensive
While there’s no doubt that remodeling a house is expensive, we often forget the costs that come with selling our old home, buying a new one, and moving. And these can be big costs. Aside from prepping your home for selling, you have to pay real estate agent commissions, sales and transfer taxes, closing costs on the home you buy, and you have to pay to move from one place to another. According to Zillow, the average person spends nearly $21,000 to sell their home and that cost can increase dramatically in higher cost-of-living areas.
You Can Choose Everything
When you remodel your home, you have control over the design. You get to choose all of the finishes, decide where things should go, and pick every color. These decisions may overwhelm some people, but if you want to choose everything in your home, remodeling gives you that creative control.
You Don’t Have To Leave An Area That You Love
Love your neighbors, your school, and your street? When you choose to remodel you get to stay and enjoy these highlights. Moving does give you an opportunity to start over, but if you already love where you live, why leave?
You Could Have A Long Move Timeline
Depending on where you live, finding your new home might be a time-consuming endeavor. In hot markets where homes go quickly, you could spend months finding just the right property. The average home buyer spends 10 weeks looking for a home in the San Francisco Bay Area. Compare that with homeowners spending an average of 6 weeks on a kitchen remodel.
Is It Cheaper To Remodel Or Move?
The best way to figure this out is to get an estimate of what it would cost to both sell and remodel, and decide if there’s a big difference.
Costs To Sell
Agent commissions: You’ll have to pay the people selling your home, and that can get expensive. Plan to spend 5% – 6% of the sales price agent commission.
Home repairs: What do you need to spend to get your home sales-ready? That might include painting, landscaping, and any repairs you’ve been putting off.
Costs of a new home: How much will your new home cost? Don’t forget to factor in closing costs.
Costs to move: How much is it going to cost to pack up your home and move everything you own to a new one?
Updates to make before moving in: Even if you buy a home that is mostly move-in ready, you still might want to make small changes like getting it repainted, which will add to the total cost.
Costs To Remodel
Materials and labor: The largest chunk of the cost of your remodel is going to be buying the new materials and paying someone to do the work. Databases can provide average costs, but getting a few quotes from professionals can help you with a better estimate.
Permitting: Depending on the extent of your remodel, you may be required to get a permit, which can add to your total cost (and time).
Cost of financing: If you’re planning to borrow to finance your remodel, don’t forget to add in those costs. For example, a home equity loan usually comes with closing costs that you should factor into your calculation.
Overage: Remember 31% of people remodeling go over budget. Build a little cushion into your budget from the beginning.
Should You Remodel Your Home Before Selling?
If you’ve weighed the pros and cons and decided that selling your home and moving is the better option for you, you may wonder if it’s worth it to remodel it before you sell. Should you finally upgrade that kitchen in the hopes that a prospective buyer will pay more?
The Cost Vs. Value report from Remodeling shows that you probably won’t get a return to make the work worth it. In fact, when looking at national averages, no home improvement projects allow you to recoup 100% of the costs. You’ll want to dig deeper into the specifics for your area and home before you make the final decision about whether you should remodel before you sell.
Deciding whether to remodel or buy a new home is a personal decision that can be difficult to make. Give yourself enough time to do the right research to come up with the option that works best for you.