Should You Add On Or Move? Comparing Costs, Value And Personal Preferences.
It’s not uncommon to outgrow the home you’ve lived in and loved for many years. There are several reasons why. Maybe there are more family members in the household now, or it could be, like millions of Americans since 2020, you started working from home full time and you need your own professional space. So now what? Should you build an addition to expand your current home, or move to a larger home?
Let’s look at some of the advantages of buying a new home:
- Mortgage rates remain historically low. Coupled with current market conditions in which buyer demand exceeds real estate inventory, it’s likely you could sell your home quickly for a rate that exceeds the asking price and much more than you owe on it. That could fund a hefty down payment on your next home.
- The high cost of building materials in 2021 and ongoing supply chain issues along with a shortage of skilled tradespeople make it much more difficult and expensive to remodel a home. Moving to a new home means you don’t have to worry about those pitfalls of planning a renovation, hiring a contractor, and living through major construction.
- Pursuing an addition might end up more complicated than you thought. Many homeowners find they need major upgrades beyond just the area where they want to add on. For instance, more bedrooms or bathrooms, or even just square footage for an expanded living area can lead to plumbing, electrical, furnace, and other utility upgrades. If you have central air, chances are it was installed for the existing size of the home and may require an additional or replacement unit to cover the larger space.
- A big renovation project also comes with additional worries: the potential for going over budget or not receiving a good return on your investment in the end. An increase in property taxes for your updated home after an addition might be a deal-breaker if that cost was not factored into your future budget.
What are the advantages for deciding to put on an addition?
- The same seller’s market that makes it easy and lucrative to sell your current home could work against you when it’s your turn to be in the buyer’s seat. It might be more difficult and expensive than you’re anticipating to purchase that larger, new home. In that scenario, staying in your current home may make sense.
- Moving is a significant life event. It takes weeks to organize, pack, move, unpack, and resettle. And every phase is made even more challenging when you have kids and pets included.
- You chose your current home for many reasons, including the neighborhood and school district. If the thought of moving away causes stress and unhappiness, then modifying your home to meet your changing needs might be the best choice.
Whatever your reasons for building an addition or moving to a new home, it’s important to consider not just the initial investment but the long-term costs and opportunities as well. Have you considered new construction for your next family home? That could be the best solution to get exactly what you want in layout, living space, lot size, and design, while also having the added benefit of starting fresh with a new roof, heating and HVAC systems, and appliances that have long warranties and won’t incur repair costs until well into the future.
We know this kind of decision is a major one. Talk to realtors, contractors, builders and architects to get all the information for the best educated decision.