When are home renovations no longer worth the investment?

last month

last modified: last month

We live in a 1968 split-level home in a hot housing market. After more than 20 years in our neighborhood, we're seeing homes like ours on larger-than-average lots being purchased and subdivided to include two or more million dollar new homes on the same plot of land.

We did a considerable remodel 4-5 years ago on the interior of the home and are now looking at siding and landscaping for the exterior. I'm looking at both Hardie and vinyl options. While I like the Hardie look (and it matches others in the neighborhood) I'm wondering if it's really worth the investment knowing our home is likely to be torn down and redeveloped after selling it? We currently have wood panel siding. While it's in OK shape, there are likely a few panels that should be replaced (who knows if we can find a match for it). It's also ugly and at least needs a new coat of paint and I'm sure the trim needs to be replaced in some areas as well.

Kids will be grown and out of the house (probably) in the next 5-10 years, which means we likely won't be selling before then. Is it worth it to invest in siding and landscaping at this stage knowing that once we do sell it'll likely be torn down and redeveloped? Would we still get a higher sale price with these renovations even if the new owners decide to tear it down? What else should I be considering other than my happiness with my home and peace of mind for the next decade?

Featured Answer

cat_ky

last month

I would do what would make you happy. Who knows in 5 or 10 yrs, the real estate market may change, and all your updates pay off. You may also decide to stay there longer too. The future is always undecided, so its best to do what is best for you while you live there.

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Comments (9)

Toronto Veterinarian
last month
Renovate for you, not for resale -- if you don't want it for yourself, don't do it.

The only time I would recommend you consider the effect on resale is if you're doing something you want and need anyway - then you can consider how what you're doing might affect the resale value. As an example, I needed to replace my not-quite-upright garage, so (since I was building anyway), I put in a double garage to help the resale value. I would not have torn down the single to replace it with a double just for resale, but it was going to be replaced anyway.
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Jake The Wonderdog
last month
last modified: last month
Good crystal balls are hard to come by these days.

You might check with a Realtor to get their take on your specific location.

I'm a big fan of Hardiplank - it looks great and holds paint (or prefinished) and will still in 10 years. I agree that you probably want to do what works for you now... not so much trying to predict the future sales trend.

I also agree that replacement/update is always a good opportunity to consider an upgrade if there's a clearly established demand. However, most remodeling projects do not ever pay for themselves in resale value - and the more "custom" they are (expensive and tailored to individual tastes) the lower the payback.
Laurie
Original Author
last month
Thanks, everyone, for your comments. I've been hedging about this for some time so appreciate your validation. Guess I better get to researching colors and patterns :)
Sigrid
last month
Homes prices are a roller coaster. My parents did a big renovation on the worn interior of their house, replacing plywood and linoleum in the kitchen with cherry, corian and tile, removing grungy wall-to-wall and refinishing the hardwoord floors underneath. It was such an improvement, but it coincided with the fall from a bubble, so it was probably 10 years before their house was worth as much as it had been pre-renovation (and pre-bubble).
Louise Smith
last month
Make the house suitable to live in. If you live in it, make it suitable to you.
worthy
last month
last modified: last month

Our home for 11 years.

And never a happier day than this!

But, then, we knew its fate from the day we bought it.
elcieg
29 days ago
Yes, it is worth the investment, now, to replace the panels, paint, and replace the trim. It's all exterior work, and necessary upkeep. Ten years is a lot of years on the exterior of a house. Who knows what will change in 10 years. You still have college tuitions to pay.

Another thought is get a market analysis on your home. If the neighborhood is changing, you may get more than expected from selling it. A married couple gets a $500,000 capital gains exemption. The only problem with this idea is you have to find a house in your hot market which you can afford. But, it is worth exploring now before you spend any money on the house.
Louise Smith
28 days ago
Markets change and real estate changes with it.

I always thought my house was a tear-down (based on my neighborhood becoming more "upscale") and the property was worth more than the house. I maintained the house since I was living in it but did no major updating renovations. For example, new roof, new boiler, repaint as needed.

Lo and behold, I sold the property (house intact) and the new owners did not tear the house down to the foundation, but rather only updated the kitchen and baths. They loved the size and layout, and realized that the forty-year-old foundation and house were sound.