An old home with cracked and peeling paint, a failing roof, and drafty windows might be a candidate for a total teardown, or it might be a candidate for a full home renovation. Sometimes a real estate investor will purchase an old home with the expressed interest in tearing the structure down and building something large and modern in its place.
This strategy may result in a significant profit for the investor, but it's not always a direction in which a humble homeowner can go because of the immense initial investment cost. However, a full renovation of the home might be possible when a homeowner has a significant amount of equity in the home and can obtain a line of credit on the home or a home equity loan.
You could also be a homeowner that has a beautiful home, but who is looking at moving into a historic home that needs a lot of work. Often billed as "fixer-uppers," these homes tend to inspire the "do-it-yourself" crowd, but they can also become a years-long nightmare of giant projects and exceptional costs regarding improvements and refurbishment.
Figuring Out the Math
Whether you want to purchase a home that needs a lot of work, or you're interested in renovating your current space, the decision to tear the structure down or refurbish it depends upon simple math. The experts at "This Old House" say the decision can be based upon a "simple equation."
First, add up the costs to renovate the property based on a thorough assessment of the condition of the house… Next, subtract that from the home's likely market value after renovation, drawn from comparable real estate prices in the neighborhood. Then deduct at least another 5 to 10 percent for extras you decide to add, unforeseen problems and mishaps that have to be dealt with, and inflation.
The number that results will be what you'd need to offer on a "fixer-upper," and it would also be a number you could consider for renovating your current home. Even if you've lived in your home for decades, it's a good idea to get an inspector on the property to tell you what's wrong. There could be problems you've not even considered.
Financial Figures You Might See
The first question most homeowners will have about a full renovation of a home is "how much will it cost?" Bloomberg suggests that a total remodeling of a home might cost an average of $192,724, according to figures published in 2012.
As you decipher the different costs of a full home renovation or targeted renovations to certain rooms, you'll also see averages for the kitchen, bathrooms, and additions like a pool in the backyard. Sometimes you can consider renovating some major rooms of the home and putting less attention into other areas of the home that might need nothing more than a coat of paint and some new flooring.
Bloomberg suggests that the average cost of a new kitchen is $24,766. Building or renovating a garage usually costs an average of $13,059. A bathroom remodeling project tends to average about $10,723.
Let Us Help You Decide
Deciding to renovate your entire home is a big step, and you'll benefit from a professional's advice on your project. If you're looking for a Yorktown home renovation contractor, contact us today about a FREE Full Home Renovation Consultation or call us at 1-757-243-1976.