The 1,2,3 of Home Remodeling
Not long ago a friend of mine was telling me about her nephew who’d been in the process of doing some home improvements. He got approved for a home equity loan based on the current size of his house and the detached garage in the back, which he planned to remodel. Anxious to begin, and with the approval on his mind, he decided to get a jump on the project and tore down the garage.
It sounds perfectly logical, doesn’t it? Here’s the problem. The final appraisal had not been submitted, and when the appraiser went back to the property to check on a measurement, he saw the garage had been removed. This dropped the property value—so much that he no longer qualified for the loan. Jumping the gun on the demolition ended up leaving him without a garage and no way to afford the other improvements he’d planned.
So here’s the moral of the story: doing home remodeling in the wrong order can cost you money (and increase your frustration) in the long run.
For a lot of homeowners, projects are often done when they have the money for them. They get a tax refund and so they replace all of their windows, or they get a bonus check at work so they put in new flooring. We understand budgets and why many people choose to approach home renovations that way.
The downside, however, comes when they are ready to complete a more substantial home remodel. The money spent on those new windows is largely lost if we end up removing a wall to add a new addition, and the time and money you spent on that beautiful new flooring may likewise go up in smoke.
So here’s the 1-2-3 method we suggest:
- Before you remodel, consider thinking through the size and type of renovation you’re considering. Do you anticipate removing walls or adding an addition? Is a down-to-the-studs kitchen remodel what you really want?
- If these bigger projects are really what you’re hoping to complete, choosing to live with ugly windows or not-so-great flooring for another year or two while you put those extra funds aside and save up for the larger renovation you’ve been dreaming of will be a better investment in the long term. It will also help you avoid the feeling that you need to limit your ideal design to accommodate the smaller projects you’ve already done.
- Always take the time to plan ahead so you know what to expect. Ask questions, find the right contractor and explore your finances (and financing) thoroughly, long before the project starts.
Oh–and take a page out of my friend’s nephew’s book: slow the roll on demo work until financing and everything else is well in place. Your car will thank you for it.