Renovating Vs Buying a New Home | New York

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Renovating Vs Buying a New Home | New York

Home inspector Bronx

Renovating Vs Buying a New Home Pros and Cons

 

If you like your home and its location, this can become a troubling and confusing decision. To clear away the “fog,” we’ve prepared some questions you should ask yourself. Your answers will make your decision easier and clearer.

Important Questions for You

  • How important is remaining in your current neighborhood?If you love your current neighborhood – and no homes that you want are currently for sale – you definitely have a major decision to make: Renovate or buy a new one elsewhere. You could always take a neighborhood poll to ask if anyone’s thinking of selling soon. Some may not want to tell you, however.
  • Will your financial position or income support the expenses of buying a new home?Be aware there are more expenses to buy a new home with a mortgage beyond the house’s selling price. Don’t overlook appraisal costs, around $500-$600, home inspection, around $250-$400, and the biggie, closing costs, often $4,000 or more. Mortgage lenders (depending on your loan program) typically will not roll closing, appraisal, or inspection costs into your new mortgage balance unless it results in a lower than 80 percent loan to value (LTV).

     

  • Will your remodeling increase the value of your present home?

    Some renovations (new bath or kitchen) increase a home’s value while others (pool, renovating attics) typically do not. Much depends on your local market and area, as there are exceptions to the neighborhood rules of thumb.It’s always wise to discuss your plans with renovation experts who know the local market for remodeling projects that add value and those that don’t add value to your property.
  • Do you have a long-term plan for your home?You should not make costly renovations based on short-term conditions. If you’re planning to sell your home and move in the next couple of years, it’s wise to think about whether you should spend the time and dollars the remodel will cost. For example, if you have a small home and plan to have multiple children in the next few years, you should think twice about adding a pool to your yard, particularly if you live in a four-season part of the country.

    However, if you love your kid-friendly neighborhood and it has an excellent elementary school right in the neighborhood, you may want to add a bedroom or two to be ready for your growing family.

The Pros and Cons

Buying a new house: Pros

  • Relocating can be an exciting plan or stressful, filled with scary uncertainty.
  • You may have multiple financing options; now you know the application process better than when you were a first-time homebuyer.
  • Favorable tax treatment when you sell your primary residence.
  • Moving can reveal “stuff” that you forgot you had since you bought your current home – some of it can be useful, while other stuff can be discarded as useless.

Selling your home: Cons

  • Expensive to sell (agent fees) and buy (downpayments and closing costs).
  • Moving is a royal pain, even if you have professional movers who also pack and unpack for you.

Remodeling your home: Pros

  • Saves money, compared to buying a new home.
  • You can add personal preferences and the features you want.

Remodeling your home: Cons

  • If your home needs a total overhaul, remodeling small spaces, will not be sufficient.
  • You might face budgetary or financing issues.
  • Remodeling turns your house “upside down” for days or weeks.

Conclusion

As usual, there is no strict right or wrong decision. If your home just needs a little upgrading, remodeling may be the best option. If you want to upgrade your entire home and neighborhood, buying a new home may be the right choice.

The bottom line: The choice is up to you.

 

 


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