Reference Guide for a Home Renovation » RealtyBizNews: Real Estate News

There are many reasons why people choose to renovate homes. First time buyers tend to buy older homes that may be out of date. Or maybe you’ve been in your home for more than a decade and looking forward to getting mortgage free. Investors have made big profits with Fix-n-Flip tags. Whether you are an owner or investor, the idea of ​​repairing an older home has been popular for many years.

Analysis of the US census data shows that at least half of the homes in America are more than 37 years old. New York State has the oldest average home age at 63 and Nevada has the lowest average home age at 26. This means that many roofs, stoves, floors, and appliances have reached the end of their useful life. According to reports, most people planning a renovation intend to spend $ 10,000 or more. For so much money, you need to plan ahead.

1. What is happening in your life? Before making important decisions, think about what you want from the renovation for tomorrow and the next 5 or 10 years. Converting the fourth bedroom into an office probably isn’t a good idea if you’re planning a family or looking to take care of older parents for the years to come. On the other hand, home offices have become very popular as more and more people work from home. Personal needs are important.

2. Preliminary examination:

• List the renovation projects you are considering.
• Discuss their home renovation experiences with friends, neighbors, and even real estate agents.
• Go to some open houses in your neighborhood to see what others have been doing. Do some research on the Internet and in magazines to get a comprehensive overview of possible ideas.
• Look for rough estimates for ideas you are considering.
• Inquire about how your planned renovations will affect your home value.
• If you are planning multiple projects, prioritize them.

3. Cost and budget. Their main costs relate to material, labor and local market conditions. You will need at least 3 estimates and likely the recommendations of contractors hired by people you trust. However, you can work out your rough estimate using online calculators such as https://app.mykukun.com/Home-Renovation-Costs. Online estimates are just a start, and expect costs to fluctuate significantly depending on your specific needs, desires, and decisions.

• Once you have some estimates from contractors, it’s a good idea to add another 30% or 40% to cover changes and unexpected contingencies.
• Whenever you remove or add walls or make foundation changes, you need the professional services of a structural engineer.
• If you are concerned about recovering your costs in the sale, prioritize your list for renovations that will give you the most return on your investment. Generally, in descending order, these are the kitchen, bathroom, apartment building, master bedroom, and loft bedroom.
• Find out about financing options if you don’t pay everything in cash. Banks typically lend 20 to 30% of the home value (this depends on your equity). If the home is worth $ 300,000 and your credit is reasonable, expect to borrow $ 60,000 to $ 90,000 for renovations.
• Common financing options include equity loans, home refinancing (preferably at lower interest rates), home remodeling or personal loans, and credit cards (usually the least preferred).

4. Hire your contractor. Once you’ve decided what you’re going to do and how you’re going to pay for it, it’s time to hire a contractor. This is when you set the final estimate. But still keep a 20 to 30% buffer in your budget. Prepare a list of project-specific questions to ask each contractor. General questions are:

• References list?
• Experience with your project type and experience close to your location?
• Licensed, bonded, and insured (their liability insurance to keep you safe)? Check what you are told.
• Comparable projects you can see? Preferably current finished projects, but at least videos or photos.
• Deadline and budget performance?
• Which are the payment conditions? Down payment, milestones, down payment + final payment, materials + milestones, total advance payment (not desired) etc. Do you ask about payments for changes in the scope of work?
• What is guaranteed and for how long?
• Do you have a single point of contact for status and how often do you get updates?
• How do you deal with any necessary changes?
• Are you asking how other parts of the home / landscaping are affected and protected?
• Do you ask about subcontractors? Make sure the general contractor takes responsibility for subcontractors.
• How do you accommodate family and pets (if you live in the house during the renovation)? Be sure to mention if you work from home.
• Do you call references to ask questions about whether they were happy with the results, budget and on-time delivery, how problems were dealt with, how long ago it was work, and whether they would hire the contractor again?
• Everything specific to your project and your situation.
• Listen carefully to all of his answers. Especially in terms of changes, budgets and scheduling.
• Before starting the work, request a written and signed offer and a contract. In case of doubt, record it in writing. Make sure all specifications are included. Include required permits and regulatory inspections. Have a well-written final acceptance clause.

5. Plan how you will live during the remodeling. How will you and your family live during the renovation? Are you going to move out Do you attach a plastic tarpaulin between the living area and the construction site? Are you going to eat out during a kitchen renovation? How do you protect valuables and heirlooms with workers in the house? Will you and your family be safe from open holes and other obstacles? Is someone allergic to dust or chemicals (paints and floors)? Do you need a storage shed? Can you drive in and out of your driveway? Make sure your contractor cleans up daily. What else has to be planned?

6. Manage contractors. Mistakes will happen. Custom-made products arrive late, inspection appointments are missed and a wall is even built in the wrong place. Be mentally prepared for these and other issues as you build if your patience is likely to be running out. Talk to your contractor regularly and point out these issues as soon as you find them to avoid a ripple effect. Make a list and go back to make sure errors have been corrected. All changes must be made in writing and include costs. Keep all communication sincere. If you lose your temper, apologize. Expect the same from him or her.

Soon you will be cooking in your dream kitchen, showering luxuriously or enjoying the high-tech lifestyle.

What are your renovation tips? Please add your comment.

Additionally, our weekly Ask Brian column welcomes questions from readers of all levels of real estate experience. Please email your questions, inquiries or article ideas to [email protected].

Author Biography: Brian Kline has been investing in real estate for more than 35 years and has been writing about real estate investing for 12 years. He also has over 30 years of business experience including 12 years as a manager at Boeing Aircraft Company. Brian currently lives in Lake Cushman, Washington. A vacation destination near a national and Pacific ocean.