3 signs that the time has come to renovate your home
Should you start moving forward with home improvement plans?
Not everyone who buys a home ends up with a perfect property from the start. You could end up buying a house with an outdated kitchen or an unfinished basement.
Renovating your house is a good way to use it better. In some cases, the improvements you make can result in a higher selling price when you decide you are ready to leave your home. If these three signs apply to you, maybe now is a good time to move forward with home improvement plans.
1. You do not intend to move
You could easily spend $ 15,000 to modernize your kitchen or $ 20,000 to turn an unfinished basement into a usable space with an integrated bathroom. If you plan to stay in your home for several years, these expenses may be more than justifiable as they will make your home more comfortable and more pleasant to live in. But if you are planning to move in a few years, then you might not want to invest in renovations that you won’t enjoy for long.
2. You have a lot of equity in your home
Home values ââhave skyrocketed nationally, and now many homeowners are sitting on a good chunk of their home equity. Equity is the part of your home that you own in full, and it’s calculated by subtracting your mortgage balance from the market value of your property. You can borrow against the equity in your home. Therefore, if you are thinking about improving your living space, you may have an affordable way to finance it.
There are different ways to borrow against your home. You can take out a home equity loan, which is a predefined amount that you borrow and pay back in regular installments. You can also take out a Home Equity Line of Credit (HELOC), which is a line of credit that you draw on as needed.
With a HELOC, you get a bit more flexibility, which can come in handy when borrowing money to finance renovations. This way, if your costs are higher than expected, you may be able to borrow more.
3. You are renovating for the right reasons
Some homeowners are motivated to renovate their property because they believe it will help them get a higher price when they go to sell their home. But in reality, there are few home renovations that offer a 100% return on investment.
Of course, you could get most of your investment back on any given project, but you shouldn’t expect to get it all back. If you are going to renovate, you should really do it at least partially for your own benefit.
Suppose you plan to spend $ 15,000 on a kitchen remodel. If you sell your home in a year or two, you could add $ 10,000 in resale value due to this renovation. If it happens to you to want an updated kitchen and will enjoy using one, so the renovation makes sense. But if you cook infrequently and don’t care about how your kitchen looks, you might not want to make that investment. Instead, you might be better off leaving your kitchen alone and getting $ 10,000 less for your home when you sell it.
Renovating your home could end up bringing you a lot of joy as a homeowner. Just make sure you can tick the right boxes before you start your next project.