move | Move or Improve

What is Better Financially: To Fix Up a Current House or Just Move?

As homeowners, we often wonder if our home just needs some renovations or if it’s time to move. There’s no surprise because as time passes so do our needs. As such, there might be aspects
and features in your current home that might not be as appealing to you anymore, or you might no longer need it in the future.

It’s easy to consider just moving right from the start but with low inventory nationwide,
you might want to rather consider remodeling your house. Instead of moving right away, you could consider altering whatever it is you dislike about your current house with a simple renovation and check if it would be practical and financially viable to do so.

There are a few things you can investigate to see if that’s the case. You’d have to scour the internet, but we took the time to compile this short guide that will help you
with this momentous decision later on. What need:

What Need

Before going into the financials, we believe it would be prudent for you to think about what you really need. You have to prioritize if what you’re looking for is want, more than an actual need.
Chances are, what you want may just be out of a whim and well, you don’t want to get stuck with spending on that (if you remodeled), or bought a new house just because of something you don’t see yourself actually using or enjoying.

Check The Costs

Whether we choose to remodel or move altogether, it all boils down to one important thing—how much we’re going to spend. No matter which one we choose, we’re going to have to shell out a few dollars.
For those who consider renovating, check with various contractors and ask for quotes. If you can get at least three quotes, all the better for an accurate cost estimate. Make sure that these line items are included: permits, architectural plans, materials, labor, and additional expenses.
For those who are selling, make sure that you factor in the following: agent commissions, moving costs, minor repairs on the new home and the current place, cost of the new home, additional miscellaneous costs.

Research

If you think that you live in a sought-after neighborhood, then it might be better to sell, but you can consult with real estate agents to gain more insights. They can help you out with research (how much you can sell your house for, if it is a good time to sell, whether your house is appealing to the market, etc.)
Consider the home you’re moving into. If you sell your house only to move to another in the same neighborhood, the proceeds from selling your current home might not go a long way.

There you have it! A quick guide to help you with your decision. Just one more thing; if you do
consider renovating, make sure that you don’t over-improve. There are risks with over-improving your home, turning it into a high-end one, in a not-so-expensive neighborhood might result in you not being able to recoup the expenses when you sell later.

MOVE or IMPROVE?

Do you think it’s time to IMPROVE your home?
People and families change over time. Certain needs and wants evolve. As children grow, often both they and the parents feel a need for separate spaces to watch TV, game or just hang out. That might mean a need for a great room addition or a finished basement. Families also enjoy entertaining friends which often creates a desire for a bigger, nicer kitchen and possibly an inviting outdoor living space. Families expand with additional children or other family members joining them. This might require bedroom additions, a master suite addition or an in-law suite.

Projects like these are tens of thousands of dollars. Larger projects or multiple projects often well exceed one hundred thousand dollars.

Now you must enter the following considerations:

Do we have the cash? Should we liquidate some of our assets? Should we seek a renovation loan?
Will we be over improving our home and pricing ourselves out of the neighborhood?
How long do we plan on staying here?

Faced with these questions, one should also consider whether to MOVE instead. That would mean doing all the minor repairs that the house needs and many cosmetic updates so that it will show well when listed for sale. De-cluttering and staging are almost always a suggestion of professional realtors.

While readying to sell your home, you will be seeking for possible homes to purchase that have the size and features that your family needs and desires. The fiscal math is not as simple as sell for “x” and then buy for “y.” Here are other expenses that may need to be factored into your financial equation:

Real estate fees
Lawyer fees
Closing costs
Professional services such as a home inspector and title insurance
Moving expenses
The possible need for new/more furniture and decorating

After that, there are some other unknown variables:

What are the neighbors like?

Friends for the kids?
Traffic?
Parking?

When you’re not sure which to do, you should consult with professionals. MOVE or IMPROVE in NJ is compromised of realtors and project designers that work together with families faced with these same options. The process is similar to the HGTV show “Love It or List It” only tailored to the real world where the decision needs to be made up front and not at the end of a major renovation at the end of an episode.