There are a number of life events and factors that may lead you to consider a renovation or a relocation. Growing families tend to need more space and durable home amenities as they add to their numbers, while even empty-nesters in retirement may weigh whether a downsize is the right move for them. Sometimes external impacts bring the decision about, like a change in the housing market making it more favorable to sellers or performance of the local school district.
Whenever addressing the fundamental choice between moving or upgrading the home, it's helpful to start by asking yourself a series of questions. Your answers will help you decide whether remodeling your home or selling is the best option for your finances, your family and your future. Here are some questions to begin with:
First and foremost, you must compare the costs of a relocation versus a remodeling. A lot depends on what more you need from the home. If it's a new master bedroom or kitchen renovation, those projects could cost in the hundreds of thousands of dollars. There are also permitting costs and budget overruns you may need to deal with, too. Moving means paying back the mortgage you initially took out, which is usually done through the sale of a home. However, if the market conditions aren't favorable, a home sale might not be enough, especially after a real estate agent is paid their share. Plus, there are closing costs associated with the new mortgage you'll take out in the next town, as well as fees for movers. Weighing the costs against the benefits is a fundamental place to start.
Sometimes while the costs are high (especially for relocations), the benefits are even greater. This may be the case if you can find a home in a new location that boasts better schools. The quality of the local public and private school options are one of the most important criteria parents consider in whether to remodel or move. If a new home that fits your needs can be found, and for a reasonable mortgage, the chance to improve your children's lives may be too good to pass up. However, the local job markets also need to be researched. While economic opportunities and good schools commonly go hand in hand, that's not always the case, and you securing a job before moving is a proactive step many take.
Proximity to loved ones is another family factor to consider. Moving may mean either living further away from family, or closer to.
If you approach the decision of whether to remodel or relocate early enough, you may be able to find a middleground option. For instance, if the conditions for a move aren't right at the moment, but you have time to spare, a medium-sized remodel could satisfy your family's mid-term needs for more space or home comforts. Choosing the right project may not only improve livability or home structure but also help you recoup some costs when you do decide to sell. For instance, in 2019, a mid-size kitchen remodel cost around $22,500 on average nationally. That remodel returned 80% of the costs at sale. A midrange wood deck addition returned 75% of the costs, on average.
Of course, every family has a unique situation, and sometimes timelines are accelerated. In such cases, having to wait through the remodeling process might not be the ideal option, as opposed to a move.
When it comes time to actually remodel or relocate, you'll want to be sure your family is prepared for whatever option is best. Remodeling, while attractive because of the generally lower costs, can be a nuisance for some. Renovations mean having to live in the home while construction is going on, or finding temporary housing. In a perfect world, no construction project would go delayed — but that's far from the reality we live in, which is one of budget and schedule overruns. A drawn-out remodel process could accrue costs and take longer than expected.
Still, it might be preferred than packing up everything and moving halfway across the country. Arranging movers and overseeing the process can be a task that takes up even working hours. But not all moves are as involved. If you're moving to a different part of the city or a new suburb with better schools, the process might not be as nerve-wracking. It all depends on what your family prefers, in the end.
If you're in the middle of making such a decision and looking for the help of a lender, reach out to us today. Contact The Federal Savings Bank whether you want to get the process started with a new mortgage or are interested in exploring options for home equity line of credit to support a remodel.