How Renovations are Impacting Real Estate Decisions in Columbus Ohio
According to a recent article from Roofstock, “Home prices in Columbus continue to skyrocket”. This is great news for those people selling their homes, but the flip side means they have to find someplace else to live and in Columbus, that is an issue as inventory is tight.
Home buying is more challenging these days due to historically low inventory and a mortgage market that is overwhelmed with a full line of applications. In addition, supply chain disruptions, labor shortages, and demand for new homes have builders scrambling to keep up with the demand. New construction has lagged behind demand for several years now and the supply chain issues created by the pandemic have only exacerbated the problem.
The Columbus, OH home sales market has been a seller’s market, with homes values soaring, bidding wars, and low inventory. These factors are coupled with a shortage of new home builds, as new research from Realtor.com states, “The U.S. is short 5.24 million homes, an increase of 1.4 million from the 2019 gap of 3.84 million” as reported in this article from CNBC earlier this fall.
To this end, we are seeing more and more people stay in their homes and choose to renovate. Many remodelers in Columbus, OH (The Cleary Company included), are booked 9-12 months out. What does this tell us? People are choosing to renovate and expand or improve their homes instead of moving. But why is this the case in addition to the housing sales issues?
Renovate Instead of Relocate
According to a 2018 Zillow Housing Aspirations Report, “76% of Americans would rather renovate than use their savings for a down payment.” While this information is from 2018, as a premier remodeling company, we know this still rings true in 2021. If you’ve lived in your home long enough to qualify for a home equity loan or line of credit, have been saving money, or can refinance and create additional equity with a re-appraisal, renovating might be a better option.
The cost of selling your home and buying a new home involves realtor costs and commissions, both minor and major repairs to the home you own and the home you will buy (especially if it isn’t a new build), title insurance, seller costs, home appraisal, moving costs, closing costs, change in property taxes, and possible capital gains taxes if your home has appreciated more than $250,000 from the original purchase price.
Pros of Remodeling Your Current Home
Even though, right now, the time it takes to renovate your home might be longer than normal, there are still many pros to remodeling.
- No need to move to a different neighborhood. The emotional investment you have created in your neighborhood with your friends, schools and amenities isn’t in jeopardy by a move.
- Change your home to fit your needs. Do you need a home office, additional space, a new kitchen, bathroom, or outdoor living?
- Choose the materials you want for your home, not what a builder may choose, or someone selling their home chose.
- Renovating a room or several rooms is less costly than buying a new home just to get a home office or extra bedroom. We can take the footprint of your home and make it work for you.
- You’ll continue to add equity/ROI to your home, provided you don’t create the most expensive home on the block when renovating.
- You don’t have to move, though a whole house remodel might mean you will want to move out for a while. We’ve had clients do both!
- It may be more cost-effective for you than buying a new home that requires changes as well.
While the choice to remodel or move is very personal and the final decision can be difficult if remodeling is the decision you make, we are here to help. We would be happy to discuss possible options with you. Our Team can help you decide if renovating your home will work for you and your needs.