Remodeling your home can be a costly, time-consuming, annoying and plain old complicated process. Even the most well-intentioned home renovators often find themselves halfway through a project and wishing they had never started it. Equally as likely is the prospect that, for whatever reason, the work stops and before you know it you’re living in a permanent construction zone. If you already own a home and you have some equity in it, moving to a place more to your liking can end up costing less, particularly as interest rates stay stable. Here are some specific discussions of why you should sell your home instead of attempting to remodel it.
1. You’ll Never Recoup the Money
The current thinking is that if you spend $50,000 on a kitchen remodel when you sell your home, you’ll be able to price it $50,000 higher, right? Well, you might be able to price it higher, but that growth won’t be based only on your new kitchen. Home prices are complicated beasts and always in flux, so your house’s market price has a lot more to do with where it is and what year the house was built. You can’t attribute that increase in price to only the new kitchen, which means that you’re not recouping that entire $50,000. Much like a new car, any renovation immediately starts to depreciate and become “not new” the instant it is finished, so when you pay $50,000 for a renovation, it declines in value almost immediately.
2. Prepare for the Worst, and Get Even Worse!
Every home renovation will run into delays, problems, and extra expenses. Contractors are notoriously unreliable and many times simply stop showing up at your project once they’ve been booked onto another. They’ve already received the bulk of your payment up front, so why should they care when (or if) your project is finished? If you think renovations are expensive, try taking a contractor to court.
Renovations are also constantly in flux because not even the best contractor can be sure what they’re going to encounter once the project starts. Mold, water damage, outdated electrical panels and faulty plumbing all can and do regularly pop up in the middle of a project. These new issues can cost thousands of extra dollars and leave you living with dirty, unfinished, and unsafe spaces for much longer than you intended.
3. DIY is a Lie
Unless you are a professional contractor, there’s almost no chance that you’ll be able to complete a renovation job without a professional’s help. Bringing in professionals half-way through the job means you have little to no negotiating power and the cost to finish the job will be close to what they would have charged you to do it from scratch. If you do somehow complete the project, you’re almost guaranteed to end up paying for your amateurish work later on. Improperly installed plumbing, electrical systems or appliances can all cause significant structural damage to a home when they inevitably break down.
Of course, there are things that a homeowner can complete themselves, and you should do those things. (I’ve never understood professional interior painters, myself.) However, make sure that the DIY project has a definite limit to it, and that you’re realistically confident that you can complete the project without calling in the professionals.
4. Hidden Costs
We’ve already discussed the hidden financial costs that can rear their head in home renovations, but there are other, less obvious costs, too. Remodeling your home is difficult on your relationships and hard on your personal mental health. Constant noise can cause anxiety and annoyance to those who are there during the work hours. Dust, dirt and dangerous tools aren’t safe to have around the home during the renovations, especially if you have small children about. (Try telling a two-year-old that he can’t play with that nail gun the contractors left in the middle of the kitchen over the weekend!)
5. Why Remodel?
Examine the real reasons behind your desire to remodel. Do you want to increase your home value? Chance are it will increase just sitting there, even without any improvements! Is your kitchen or master bath truly non-functional, or have you just been bitten by the “improvement” bug? Everywhere you look these days home improvement is all the rage. However, an outdated kitchen almost certainly still serves your needs as well as an entire remodeled kitchen would. Keeping up with your friends and neighbors is not a reason to take these kinds of financial and emotional risks, especially when you’re unlikely to see a real jump in your home’s value.
Furthermore, the stress of coming up with exactly what you want, building it out, and then finding that it doesn’t magically solve your problems or make your life better is a real occurrence among those that undertake home renovation projects.
6. Tax Consequences
Most Americans can obtain as much as $500,000 in tax credits from the sale of a home. There are no tax credits for home remodeling. This makes selling your home a much more attractive idea. Selling your home is also financially less complicated, because the process of home buying is fixed and relatively easy to maneuver, especially if you’re already a homeowner.
Don’t let the constant barrage of home improvement shows and do-it-yourselfers get to you! If you have needs that your current home doesn’t meet, then you’ll almost certainly be better off selling your current home and purchasing a new one.
