Moving:
A good real estate agent in your area should be able to help you figure out these numbers.
How much will it cost to buy a home that meets all of your needs?
How much could you get for your house if you sold it? Don't forget to take the commission of the agent out of this total.
How much does it cost to move? Dan Fritschen, a real estate expert and the author of the best-selling book Remodel or Move, says that a typical move costs 10% of the value of your home.
How much will your property taxes go up because you're moving?
Remodeling:
What projects do you want done, and how much will they cost? You can get help with these numbers from an architect or a general contractor.
How much will your home's value go up because of the changes? This is called the "payback." A real estate agent in your area can also help with this.
If the decision about whether to remodel or move was just about money, it would be easy to look at the numbers and know what to do. But there are also emotional factors that play a role, and they are also important. Let's consider some examples.
You might want to move because:
If you move to a new neighbourhood, your kids might be able to go to better schools.
You'd like to cut down on your commute time or have easier access to things to do in the area, like restaurants and shops.
You don't really like the area where you live now.
Your yard isn't big enough, and you can't make it bigger.
You might want to stay and remodel because:
You are happy where you live. It's easy to get to, you like your neighbours, and the schools are good or don't matter.
You love the way your home is set up.
- All you need is a little more space, and your house will be perfect.
Only you can really know what makes you happy, so try to use these questions as a place to start. Make a list of the pros and cons of each situation and put it somewhere you and your partner can see it so you can add to it as you think of more things. You could also go to open houses and new housing developments to see what else is out there and how your home compares.
After you've made your list and figured out how much it will cost, it's time to come to some conclusions. Do the numbers and your feelings point you in the right direction? If you're still not sure and want more help, you might want to read Remodel or Move, a book by Dan Fritschen, or check out his website. Both have a calculator that will help you calculate the effects of your choice, which is a hard thing to do. You can also get advice on how to take the next step once you've decided what it will be.
If you decide to remodel, you'll need to know what you want to change before you talk to the contractor or architect about the details. Changing a project in the middle of it is one of the most expensive things you can do.
If you decide to move, you can make some low-cost changes to your current home that will make it easier to sell. The best places to put money in this area are the kitchen and the bathrooms.
Whether you want to fix up your current home or buy a new one, it's important to make sure you have the money to do so. If you decide to buy a home, a mortgage originator will help you figure out how much you can afford and which loan package fits best with your overall financial plan. Before you start construction on a remodel, you should talk to a mortgage professional. If you don't, you could severely limit the kinds of loans you can get.
