| Should You Add-on or Move?|
A question that many people are faced with: Should we buy a new home or should we just add on to our existing home? After some analysis, a logical solution can derive from what seems to be a complex question.
In real estate appraisal there is a principal that suggests that all homes in a given area should be of similar size and value. This is called conformity. Regardless of how much money you have invested in your property, it could cause you to “over-build” your neighborhood, which would lessen the value of your home, and influence the value of the smaller homes.
You should be able to enjoy the additions, especially if you plan on staying in your home for a long time, therefore rekindling the cost, regardless of whether it increases the value of the property once it sells.
Creating what appraisers call “functional obsolescence” is another difficulty that homeowners face when making an addition to their home. For example, if a floor plan ceases to be unconventional because of an added-on family room or bedroom, the new room could be functionally hampered, affecting its value.
Some good advice from contractors
is that the size of the addition could expand the cost of additional heating, cooling, and work around the foundation. Many times an addition onto a small room may cost as much as an already large room.
There are certain room conversions that lessen the value of the property. If a two-car garage was converted into a family room, it could actually penalize the value of the home and hurt its ability on the market. This comes from people expecting a home should have a garage, regardless of the nice additional living space.
People expect different amenities throughout a home if it gets to a certain size in square footage. As long as everything else is updated while making the additions, these things won’t be outdated.
In most cases, homeowners are better off just selling their existing home and buying another. However, if a homeowner decides to make additions, careful attention to the above considerations is highly recommended. In any case, third party advice is advised.