Things to Consider
Remodeling your home is always a bigger project than you think, so's important to seriously consider the financial factors and the impact on your daily life. When you budget the time and money for a proposed remodel, automatically increase each estimate by 5%-10%. Make sure you plan how your daily life is going to function with contractors in and out of your home, and normal conveniences not working.
According to Remodel magazine, the financial cost of a remodel is rarely fully recouped in an increase in your home's value, which sounds discouraging. However, when you factor in quality of life, that changes the equation. Choose a project that will both increase your personal enjoyment of your home and the value of your home. If you're a gourmet cook, build your dream kitchen. If you have a stressful job, install a sunken Jacuzzi tub in your master bath. For the best return on your money, talk to your agent about the trends in your local neighborhood.
Next, consider the cost of upgrading versus the cost of moving. If your family has expanded beyond the limits of your home, by the time you add another bathroom and more bedrooms, it might be cheaper to move. On the other hand, if your home's feeling outdated; new appliances, cabinet doors and countertops can freshen up a kitchen for a reasonable cost.
|Economics of Selling and Buying a Home|
2006 Cost vs. Value Chart (HomeGain.com)