If you live in an older home or one that could use a couple of updates, the question is often: Move or renovate? But, today, there’s another question among those who want to renovate: Do it now or wait?
Increased prices on many items, “from tile to counter tops, laminates to lighting,” said CNBC, are painful, thanks to the trade war with China. “Nearly three out of four remodelers this year reported higher prices for customers due to higher costs for labor, according to a new survey from the National Association of Home Builders,” they said. And that was before tariffs went from 10% to 25%.
“Annual gains in improvement and repair spending on the owner-occupied housing stock are projected to continue decelerating through early next year, according to the Leading Indicator of Remodeling Activity (LIRA)…by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University,” they said. “The LIRA forecasts that year-over-year growth in homeowner remodeling expenditure will slow from about 7 percent today to 2.6 percent by the first quarter of 2020.”
Chris Herbert, Managing Director of the Joint Center for Housing Studies, stated that, “Cooling house price gains, home sales activity, and remodeling permitting are lowering our expectations for home improvement and repair spending this year and next. It should be noted that none of the major metropolitan markets are expected to decline, “However, growth in remodeling is expected to fall below the market’s historical average of 5 percent for the first time since 2013,” he said.
Metros that are expected to experience the “most pronounced slowing” include San Antonio, Kansas City, Pittsburgh, Buffalo, and Dallas, while, “Remodeling gains should remain strong and even accelerate through year-end in some areas of the country including Orlando and Las Vegas where remodeling permitting, house prices, and homebuilding have picked up,” said Elizabeth La Jeunesse, Senior Research Analyst in the Center’s Remodeling Futures Program. “Regionally, the strongest growth in 2019 is expected to be among metros in the West, paced by projected growth of 8 percent or more in Sacramento, Denver, Seattle, Tucson, San Jose, and Las Vegas.”
If you plan to live in your home for several years and immediate return on investment isn’t critical, proceeding with a renovation may be prudent, regardless of geography. If you’re renovating to sell, or if you’re not sure how long you plan to say, you may want to take a beat. According to Cash Money Life, these are the three reasons renovation makes sense:
1. You have a functionality problem.
“When your home disrupts your ability to sleep, eat, or get to a bathroom, it warrants a renovation—if the cost fits your budget, of course. Making a few renovations can really enhance how you feel about your home and make it a place you want to stay in for the long-term.”
2. Reno will save you a few bucks.
Think energy-efficient features that will pay for themselves.
3. “Your home isn’t competitive in the marketplace.
If you do want to sell your home now, or in a few years, and know that it’s outdated compared to similar homes nearby, doing a remodel can help you get a leg up on the competition.”