Consider The Cost Of Your Planned Renovations When Planning Your Offer


Consider The Cost Of Your Planned Renovations When Planning Your Offer
By Scott Rogers • November 8, 2024
Sometimes we will find a home that is a perfect fit for you. More often, we will find a home that is a relatively good fit, but where you'll want to make a few changes or improvements or renovations after you purchase it. If you are purchasing a $300K home and you plan to paint a few rooms and maybe change out some light fixtures... you probably don't need to think too hard about the cost of your planned renovations relative to your offer price. But... if you are purchasing a $500K home and you plan to remodel the kitchen, remodel a bathroom, replace most of the flooring and most of the light fixtures... you probably should consider the cost of your planned renovations relative to your offer price. In this second scenario, you might end up spending another $100K... on top of the $500K purchase price of the home. As you might imagine, these renovations will not cause your home's value to increase to $600K. You will certainly see an increase in your home's value given those renovations, but you will have invested more in your home than it will be worth even after those renovations. If you purchase the home for $500K and spend $100K on renovations, you've put $600K into the home. If it is then worth $550K, you might be comfortable with that overall scenario if you plan to spend the next 10 years in the home. But... perhaps you'd rather try to pay $475K for the house, and then spend $100K on renovations, to have a total of $575K in the house... with the home that it will then still be worth $550K after renovations. We typically can't have a firm sense of the cost of your renovations, nor the home's value after those renovations are complete -- but the more renovations you plan to make, the more time we should spend discussing these numbers to guide your potential offer terms. Receive Updates by Email Recent Articles: Home Sales By Price Range In The City Of Harrisonburg Are You Compromising On Aspects Of Your Next Home That You Can Or Cannot Change Later? How Much Slower Are The Winter Months In Our Local Housing Market? Rockingham County and New Home Sales Drive Surge in Area Housing Market Find The Balance Between Optimistic And Realistic Home Pricing Room Size Is Difficult To Understand Solely From Real Estate Photos How Much Would You Value Not Having To Prepare Your Home For Showings? One Out Of Four Homes Is Taking Longer Than A Month To Sell We Will Likely See Fewer New Listings Over The Next Few Months
Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com
Based on information from the Harrisonburg-Rockingham Association of REALTORS® or its MLS, for the period Jan 1, 2000 through Nov 21, 2024 (unless otherwise noted).
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