As Economy Improves, Remodel Cost Rises W/Home Prices
Increasingly, as home prices improve with the economy, more people will undertake a major remodel as opposed to buying a new home. This, of course, assumes they like their present location and basic layout of their home, and would like to remain there.
With the Bay Area economy now solidly back on track, homeowners’ thoughts increasingly turn to remodeling.
Whether it’s long-time homeowners looking to update their surroundings or new buyers wanting to make changes to suit their own tastes, remodeling projects are increasingly popular today.
A recent survey found that homeowners are willing to spend 30 percent of the value of their home when they remodel, and they’re not skimping on the work: They are selecting materials that are more expensive than in years past, with upscale remodeling jobs now costing an average of $102,000.
“The wealth effect is taking hold; consumers are spending again, which bodes well for the entire home improvement industry,” said Dan Fritschen, co-founder of Planese Inc., which offers advice on home-improvement projects and sponsored the survey.
“More people are feeling secure enough during this economic environment that they are remodeling,” said Fritschen, in a statement accompanying the survey results. ”It’s no longer the most affluent. We are at the beginning of a multi-year trend.”
The nationwide survey found that 74 percent of homeowners plan to hire a general contractor for the remodeling work, up from 64 percent in 2010 and 2007, and 43 percent plan to outsource the entire job, up from 36 percent in 2010 and 2007.
And the remodeling projects are getting bigger, too. Homeowners plan to remodel an average of four rooms, with the kitchen their No. 1 choice. Kitchen remodels tend to be more expensive than other rooms, and it’s considered a discretionary expense — unlike a bathroom, which is often viewed as a necessity.
Are you one of those homeowners planning a remodeling project? Take a look at some pointers offered by the National Association of Realtors, in its Realtor magazine.
A recent article included 12 tips for hiring a remodeling contractor, and the latest edition of the NAR’s annual Cost Vs. Value Report advises that sellers can get the most bang for their home-improvement bucks by focusing work on the exterior. Curb appeal counts, because first impressions last longest.
(Image: Flickr/Summit Design Remodeling)
If a remodel is a possibility in your thinking, give us a call. While we do list and sell homes, we also maintain an up to date list of the top contractors and tradespeople in virtually every area for every type of work. All of these individuals have been used by ourselves and or clients for many years and are excellent at their specialties. We'd be happy to give you a reference.