Should You Renovate or Sell?

Renovate or sell your home? A common conundrum for homeowners who realize their current space isn’t enough space. Or rather, their home, needs and preferences have somehow parted ways. Perhaps it’s old carpet, or maybe laminate flooring which has survived long past its in-style date.

Whatever the reason, it’s time to move on or move out. But which is the better choice? Is it more preferable to gut the home room by room or call in a professional listing agent and put out a For Sale sign?

Regardless of the final decision, there’s going to be a lot of time and effort put into both. The phrase, “nothing worthwhile is easy” will be ever-present no matter the choice. But the good news is, you can find the answer to which best suits your particular situation. After giving a few things some consideration, it’s quite a bit simpler to decide between remodeling and selling your home.

The Property Market

Everyone’s heard the comparison between investing in real estate and the stock market. The safe bet, it’s been said over the years, is real estate. What this means is if you’ve begun to think about selling and moving, there’s some things you ought to be aware of before you put your home on the market.

“It happens suddenly, over a cup of coffee and the morning newspaper, or perhaps as you make your way across the obstacle course of clutter that was once your living room. Your house doesn’t fit your needs, and you can’t deny it anymore.” —MSN Real Estate

Sure, the vinyl siding on your home might be due for a good scrubbing, the garage doors need painting, the gutters are filled to the hilt, and the grout in the tile has turned black. Those things can easily be fixed. But selling on the other hand, brings a whole new set of challenges. Challenges that might not seem too daunting but wind-up being one nightmare scenario after another.

As the real estate market continues through a slow recovery, home values still remain low. That means not getting out of your home what you paid. What’s more, high inventory levels from foreclosures and short sales means competition to buy is stiff. And with so many people trying to get in at a reduced price, that means less chance of finding a real bargain.

Choosing to Renovate or Sell

Get ready to crunch some numbers and do a little bit of soul searching because you’re going to find that selling might not be as a grand bargain as renovating. Sure, it’s a fresh start so-to-speak, but there’s a lot more to it and you’ll have to take into account many of the following considerations to make an informed, unemotional decision:

  • The cost of selling versus remodeling. Selling means paying a sales commission–usually about 6 percent of the selling price. It also means having to hire a moving company, and perhaps renting for a short time. It likewise means taking out a new mortgage and taking a hit from capital gains taxes. Whereas remodeling will get you an ROI between 80 and 85 percent.
  • Think about location. You likely choose your current home based on its features–and it’s location. If you sell, you have to consider how it will impact your commute. You’ll also have to think about school zoning and conveniences such as grocery stores, dinning, and the like.
  • Impact on your daily life. Okay, so renovating may be messy, but it’s probably not as inconvenient as selling. If you chose to sell, you’ll have to depersonalize your home, vacate it for every open house and be subjected to ridiculous demands by potential buyers. Plus, you’ll have to be activity looking for another home and be available when your agent calls to show you another property.

If you are considering buying or selling a home in Orlando, contact us for the latest market information. We’ll also provide you with the right advice about the local real estate market so you make the best decisions.