Should You Move Or Remodel?

By Tara Baukus Mello


Throughout your life, your goals and aspirations will continue to evolve — and what you want out of your home will naturally reflect that ongoing progression and transformation. Once you've reached that exciting (and pivotal) decision to revitalize your living space, there are typically two options — purchase a new home or renovate your current one. Neither of these paths is right or wrong, but are simply different means to the same end: Happiness, comfort, and, ultimately, the setting most conducive to achieving your vision for the next act of your story.

Here are a few factors to consider before you make your decision.

Know Thy Motivator

First, determine why you’re making a change. If you’ve simply run out of room — perhaps you’ve welcomed a new child or aging parent into the space, or you've launched a business that requires a more expansive spread than an office nook — then, depending on your resources and level of attachment to your current home, your decision is probably predominantly a matter of price.

On the other hand, your desire for change might be motivated by shifting tastes or a craving for freshness. Remodeling may be the preferred approach, assuming the changes you envision would involve less money, time and effort compared to moving into that "perfect place."

Tabula Rasa vs. New Paint on a Familiar Canvas

The blank slate of a brand new or new-to-you home inspires for obvious reasons — it represents a chance to shake things up; to reimagine and reconfigure the elemental building blocks of your material life within a completely new context. It’s a large, undertaking, yes, but if you have your heart set on big, foundational change, this is your play.

There is, however, also something to be said for reevaluating and renovating the home in which you now reside — you know this space inside and out. You know the quirks and the flow and the natural way your family migrates through and exists within it. You’ve got a pretty good idea whether it’ll vibe with a modern or rustic makeover. That’s a real advantage.

Having trouble seeing your abode with new eyes? Try visiting a home similar in size and layout to yours currently on the market. Take an in-depth look at how someone you don’t know utilizes a space not all the different from your own. Think about how you could modify and integrate what you like into your renovation plan — and make mental notes of what you don’t love to make sure you don’t repeat it.

Hold onto that potential buyer mindset when you return home. Imagine this is not your space, but just another house to be objectively appraised and assessed. What would you change? Could that grown child’s room perhaps make the perfect library? Is that home office crying out to be transformed into a playroom or sewing room? Might that corner full of half empty boxes in the finished basement lend itself to a great game room once purged? With creativity, imagination, planning and some effort, transforming your current space might be the perfect solution.

It’s Okay, Get Emotional

It's hard to not let feelings get involved in such a big decision — and that's okay. You wouldn’t want to make a decision between whether to remodel or buy a new home based on emotion alone, but if you love your little private lot on a quiet cul-de-sac street, those feelings are valid and should be taken into account. Remember, lifestyle matters, too. No home is an island. You want the community it exists within to dovetail with your life goals. Take a holistic approach, and the change you affect will likely be more satisfying.

Numbers Aren’t Everything, but They Do Matter

Whether a remodel is more or less expensive than a move naturally depends on individual circumstances and ambitions. Adding a new wing to your house may be cheaper than moving to a fancy neighborhood, but it is probably more expensive than moving to a comparable space one block over.

That said, generally speaking, a full remodel costs around $100,000 on average, according to a 2016 survey from BuildFax, while a single room costs around $10,000. A workable rule of the thumb is $9,500 to remodel a kitchen, $4,800 for a bath and $13,300 to add a room onto a home, according to the 2013 American Housing Survey (the latest data available). To get a better estimate for your specific project, speak with professional remodelers. Estimates can vary widely among contractors, so be sure to request as many quotes as it takes to get a decent idea of the area average for a project such as yours. And always ask for references. Sometimes a cut-rate deal is not all it’s cracked up to be. Also, be sure to keep these seven ideas in mind when it comes to saving on remodeling projects. Your bank account will thank you!

Alternatively, hiring movers to pack and transport a three-bedroom house across town costs around $3,000 on average, but can easily reach the tens of thousands of dollars for larger homes, or for moving longer distances. Use a moving cost calculator to get an estimate.

And while we’re on the topic of dollars and cents, be sure to consider how much value the improvements would add to your home when you eventually sell. Are you likely to recoup your investment? It’s tough to tell: Many home renovations do not pay for themselves in a higher sales price down the road. Most experts say the most one can expect to recoup is 50 to 90 percent depending on the renovation and how it "fits" within the other homes in the neighborhood.

Cost of Living

As you work toward a final decision, be sure to think through the short- and long-term costs: On the one hand, moving may result in a substantially different mortgage payment and terms, utility costs, property taxes and HOA fees. On the other, if you remodel, your property taxes could be reassessed or your insurance premiums could change.

"Remodeling that includes updating electrical, plumbing, heating/cooling or roofing can often make you eligible for better coverage or earn you a discount, while moving to a different home may make you eligible for a lower premium through more advantageous rating factors," says Eric Roethe CIC, Product Development Senior Specialist at American Family. Want to learn more about insurance and remodeling? Check out these five tips.

A remodel can also be a great opportunity to make other changes at a reduced cost. For example, if you are adding a room and a section of your attic is opened up, you might be able to replace all of the heating and cooling duct work in your home for less money than it would otherwise cost you because the workers will have easier access than if you weren't remodeling. Updated duct work could reduce utility costs overall, so it's a real win-win!

If your remodel would require a home equity loan, be sure to also factor in the loan payments, and how the loan would impact your overall financial goals. Some home equity loans have higher interest rates and shorter terms than mortgages, so your monthly bills may be higher than moving, even to a more expensive home.

Eye on the Prize

Once you’ve committed to a plan, it's smart to stay focused on the change you wanted to create in your life at the outset of this process. And while you're at it, give yourself a pat on the back! Deciding to remodel or move is a big decision, but ultimately it's a positive step in your journey to create a healthier, happier and comfortable environment for yourself and those you care about.

Whichever you ultimately choose, it's a good idea to talk to your American Family agent, who will be there to support you and help make sure you've got the right coverage to fit your new living situation.


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Related Topics: At Home , Home Insurance , Owning A Home , Selling Your Home