Best Reasons for Remodeling
Remodel vs. New Construction Costs
Should neighborhood pricing be a concern?
Recovery Costs
National Remodeling Statistics
Recent Home Repairs

If you Intend to Remodel or Renovate Consider the following: (click for answers)

Should I ask a lot of questions?
Should I review a contractor's past jobs?
Are building permits necessary?
Are contract deposits usually required?
How do I make a final decision if I have received several bids?
Should I have construction plans?
Is historic renovation different from normal renovation?

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General Information

The Biggest reason for remodeling should be that the homeowner loves his or her location and perceives the home to have inherently high value.

Remodeling is often a more expensive proposition per square foot than building a new home because there are demolition, tie-in and structural considerations.  Often problems are revealed during the remodel process that are critical and need to be fixed.

Out pricing the neighborhood should be a concern when considering remodeling.  If the value of the home plus the renovation/remodel cost exceeds the average value of homes in the neighborhood, the homeowner has to decide if personal satisfaction is enough.  Often the cost recouped in selling a remodeled home does not approach the amount spent on the remodeling work. 

Recovery costs are an important consideration if you intend to sell you home in the near future.  Typically, according to national statistics, kitchen remodels represents an 88% recovery cost, two story additions 84%, and bathrooms 82%.  Often, if the quality of materials or workmanship in a remodel is questionable, the recovery value is low.  The same goes for very specific design or color choices.  They can lower the value of a remodel and make the sales price increase objectionable to many buyers. 

National remodeling statistics are as follows: a 200 square foot kitchen remodel averages $14,847, a two story addition $67,743, bath remodel $9,748, and bath addition $14,216.  These figures represent average building materials, not the high end products homeowners often choose such as solid surface countertops and custom cabinetry, which can drive costs up considerably.

If you recently did costly but necessary home repairs (replacing roofing, Heating/Air conditioning, etc.) that is considered homeowner maintenance, and not something you should expect to recoup in the sale of your home.

If you Intend to Remodel or Renovate Consider the following:

Ask lots of Questions before hiring a contractor, being sure of licensing and insurance.  Ask that copies be provided and attached to your contract.  You can also check with the Better Business Bureau and the local remodeler's council.

Try to review a past job the contractor has done that is similar in scope to yours so you can see the "fit and finish" of the work, and talk to the homeowners if possible.   A list of references is not always reliable for obvious reasons.

Building permits are necessary whether you do the remodeling or hire a contractor.  Reselling without verification of passing a final building inspection on a renovation/remodel can get very messy.  This usually becomes an issue during the official "home inspection" or while the loan is being processed.

Contract deposits to your Contractor will usually run 20% for remodel projects over $10,000.  For smaller projects 50% is an industry average.  Any variance from these figures should send up a red flag.  Large projects are usually funded by the homeowner over the course of the project and are based on a percentage of completed work. Draws on the contract amount should be specifically outlined in your contract.  Contracts should be fair to both parties and detailed with respect to the scope of the work. 

If you get several bids, it makes sense that the lowest is probably not the one you would necessarily choose.  If a contractor wants your business, he or she will bid competitively and fairly.  The hardest part of this scenario is comparing "apples to apples".  A good way to do this is to draw up the project specifications yourself, and give each contractor a copy to base their bid on.  Upon selection of a contractor, the project specifications should then become part of the contract, so no variance can occur.

Construction plans are necessary if your renovation /remodel involves additions to your existing home.  This is money well spent, as it ties all bidding contractors to the same information.  Some remodeling contractors can provide drawings with their bid for a fee, which is refundable upon acceptance of contract.  Otherwise, local design firms often have employees that specialize in addition/remodeling plans.

Historic restoration is best left to contractors that specialize in it.  If your home is old enough to have uncommon building components and you want it restored to its original condition and architectural detailing, that may be beyond the ability of some contractors.  Talk that over with the bidding contractors and seek out those that understand your needs.

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