By Carmen Santora
Carmen Santora, Executive Director of the Better Contractors Bureau in an effort to help homeowners contemplating a major remodeling project and who are concerned if the cost invested would be recouped should they decide to sell their home offers the following information. His analysis is based on a national average “cost vs. value” survey and condensed it to specifically relate to our local area.
The resale value depends on a lot of variables, such as the state of the housing industry and local market conditions in particular at the time of sale. A lot of homeowners are concerned that their remodeling investment doesn’t price their home out of the neighborhood averages. This should only be taken into account if you think that you may be selling your home in the near future.
If a homeowner has small children and is thinking of adding extra bedrooms or an additional bathroom they may want to think of the advantages of staying where they are. If the schools are great, they live close to their workplace and shopping and are in an area of lower taxes or other personal conveniences, then they shouldn’t worry about pricing themselves over their neighborhood averages, especially if they intend to stay there for many years.
However, if the homeowners know they will be staying where they are for only a short time then a major remodeling would be foolish. Things like energy efficient updates such as new replacement windows, high efficiency furnace, roofing or siding, kitchen or bath updates would add to their comfort and help to sell the house faster and save them money while they still remain in the home. Major expenditures for a new kitchen and bath can run into thousands of dollars and unless money doesn’t matter or you don’t care about resale values then by all means go for it.
It’s important to know that there are a variety of variables that can effect both the cost of the remodeling and the resale of the home such as the size of the remodeling company estimating the project and the values of the properties in the surrounding neighborhoods.
Below are some area examples of the cost of what some remodeling projects can cost and what could be recouped if you sell your house. The numbers presented here should only serve as guidelines when contemplating the potential return on your investment for a particular remodeling project.
For a more information as to a more precise explanation of what the projects mentioned above include call the Better Contractors Bureau at 338-3600.
Recovery costs for home improvement projects remain high and have been accelerating even though the growth in spending on home improvements has declined nationally for most of 2003. As the economy improves so will spending on home improvements.
Lower priced projects during a sluggish economy are typical and usually only what is needed to keep a home energy efficient or make essential repairs. Higher priced projects tend to be more discretionary, and usually homeowners wait for the economy to improve before undertaking these expenditures.
In some market areas where house prices are growing rapidly, and local economies are doing better the average cost recovery can be much greater than the figures shown. The National average for cost recouped for the projects mentioned in 2003 was 86.4% and higher than 2002. Some areas such as Los Angeles, Miami, New York, San Diego, and Washington were much higher and averaged as high as 109%. Some areas as Cincinnati, Cleveland, Dallas, Detroit and Indianapolis averaged 65% or less.
Carmen Santora, says that he believes that within the five county area that the BCB services, the average cost recouped for home improvements probably falls lower than the national average and is somewhere around 75% or less range.
The Better Contractors Bureau is a non-profit consumer protection agency that was formed in 1974. Its goals are to “PROTECT & INFORM” the consumer and ELIMINATE the unscrupulous contractors in the area. The BCB as it is also known operates in Monroe and the five surrounding counties and has over 400 members. The bureau handles complaints, mediates disputes between the contractor and consumer (not just members) and refers contractor members by way of a FREE Consumer Guide & Membership Directory. For more information you may call 338-3600 or go to the BCB website at www.the-bcb.net.
