Remodeling is just another word for aggravation. So why is everybody doing it these days? Because they can – and some think they should – thanks to the rampaging real estate market. As property values multiply, millions of homeowners are remodeling to protect their investment while improving their space, upgrading laminate countertops to granite and turning their bathrooms into spas.
Several national surveys show substantial majorities of homeowners say they remodeled to increase their property values. It’s just smart: “Buyers who do not have the time to do their own improvements are will to pay a premium for something perfect,??? says Ron Phipps, a rea estate broker in Warwick, R.I.
How else to explain the staggering inconveniences people will put up with while immersed in home improvements? For months, they’ll wash dishes in the bathroom. Live with dust and debris and work crews turning up at 7 a.m. to pound on the roof or pound on the door while their own heads pound with exasperation.
“We are idiots,??? says Trish Hadley of Midland, Mich., only half-joking. She and her husband, Patrick, bought their first house more than two years ago and embarked on a frenzy of do-it-themselves remodeling that included new roof, deck, porch, plumbing, paint, floors, doors, kitchen, landscaping and paved driveway. “We bought a fixer-upper as a result of watching too many damn episodes of Trading Spaces and various home improvement shows,??? she says. “We thought would be fun and, hopefully, make some money??? at resale. Now, they are burned out. But not bummed out. Their $95,000, 1,050 square-foot, three-bedroom ranch is now work at least $120,00. “Yeah, it was worth it,??? she sighs, happily. “It’s just more eye-pleasing.???
To whom? To themselves, of course, but also to real estate agents and potential buyers. Remodeling activity amounts to about 2 percent of the total U.S. economy, according to Harvard’s Joint Center for Housing Studies. In 2003, homeowners and rental-property owners spend $233 billion on home improvements – a 54 percent increase over eight years.
Some people just love to remodel – those eccentrics who get a kick out of living in a state of disorder. Some remodeling fiends are just practical: They need more space. Others say they couldn’t care less about adding value. “I simply want a functional and attractive second bathroom without breaking the bank.???
Numbers to back trend: There’s even more evidence (besides those packed parking lots at home improvement superstores) that the remodeling biz has gone crazy with the real estate market.
The National Association of Home Builders says house sales nearly have doubled since the early 1990s: Nearly 6 million existing homes were sold in 2004, up from 3.2 million in 1992. “The turnover in house has a strong relationship with remodeling activity,??? says Gopal Ahluwaila, NAHB director of research. “You want to keep up with the value of your investment because it is appreciating.???
The National Kitchen and Bath Association, citing market tracking by Kitchen & Bath Business magazine, says that in 2004, Americans spent about $47 billion on kitchen renovations (11 percent more than the year before), and $23.6 billion on bathroom renovations (7 percent more).
Recent national surveys for Minwax and Ace Hardware found that up to 83 percent of home owners say they remodel at least in part to enhance their property values.
The National Association of the Remodeling Industry reports membership has grown 45 percent in the past 5 years. Last year, a record 85 potential customers contacted Mark Stephenson, a remodeler in Villanova, Pa. This year, he says, he had 75 leads by the half-year mark.
By Maria Puente