Your Sacramento home isn’t working for you anymore. Maybe you need a bigger closet or your just can’t stand your outdated kitchen. And that closed floorplan? It makes entertaining pretty difficult. The question isn’t whether or not to make a change — it’s about which change is right. Should you remodel or move?
From the costs involved to the time investment, there are many factors to consider. For some homeowners, it makes sense to remodel the home and stick around. If you love your neighborhood and the house has good bones — this might make sense. Other times, there is no way to make your current home work. You can’t exactly add a bedroom to your two-bedroom condo when you expand your family.
Go through our checklist as you decide whether to remodel or move in Sacramento.
Remodel or Move Question Checklist
- Do You Have Equity?
Have you been in your home long enough to build equity? If not, then moving might be off the table for now. Selling a home without any equity could eliminate any chance at a profit margin, even if you’ve paid down some of the principal. In fact, after commissions, selling a home without equity could mean you actually pay money just to sell the property! You could also get stuck in a short sale. All of this is to say, if you don’t have a lot of equity yet, you might consider remodeling the room you hate instead of selling right now.
- Is the Market In Your Favor?
Is it a seller’s market? If there is an abundance of inventory and too few buyers, your home could end up on the market for months. This is especially true if your neighborhood isn’t on any hot lists right now. On the other hand, if your zip code is selling homes like hot cakes, you might want to get in on the action. Waiting to sell could mean leaving money on the table. Always evaluate the current market before you decide whether to invest in a remodel or sell and move on.
- Are There Underlying Issues with the Home?
Was your home built in 1940, with few major updates? A remodel could open a can of worms. You never know what plumbing and electrical issues will arise with a remodel. If your home no longer fits your lifestyle, it’s often worth moving if you have a super tight renovation budget. When you sell, you’ll only have to take care of basic repairs and anything the inspection uncovers.
- Are You on a Timeline?
Do you need a bigger home in a few months as you expand your family? A remodel can easily get delayed by weeks at a time. And a home can sit on the market for many months if it’s not a hot property. Consider which option is likely to move more quickly given your specific circumstances. While a fast move often seems easier than tearing up your own home — remember that many people rank moving as more stressful than a divorce.
- Which Option is Cheaper?
Common costs associated with a move include agent commissions, marketing costs, staging costs, moving van costs, and the price of routine repairs. For remodeling, common costs include permits, labor costs, the price of materials, financing costs, and potential unexpected fees. At the end of a sale, you may end up making money (especially if you’re downsizing), but a remodel will never turn an immediate profit. Taking your attachment to your home out of the equations, what makes the most financial sense?
TL;DR: Renovating your home can come with unexpected surprises, like permit delays and extended work times. And you won’t recover the costs until you sell (and often not at 100% ROI). But it can still work for people who love their home and/or don’t have enough equity to justify a sale. Moving can be the right choice if you can’t make the changes that would be necessary to make your home more livable, or if the market is in your favor.
Want to move but can’t afford the renovations needed to compete on the MLS? California Family Homebuyers may be able to help! We buy Sacramento homes in all sorts of as-is conditions and we close fast!