Julie D, as we shall call her here, shelled out $370,000 a year ago for an expanded, 2,200-square foot Cape in need of a little work just inside the 495 beltway.
There are many things she likes about her new home, which is in a 1960s-era subdivision with lots of colonials and split levels. It sits on a large lot with lots of nice old trees on a quiet street with "no line down the middle,'' she notes.
Yet given the renewed turmoil in the housing market, Julie D has a few nagging doubts about whether it's really worth it to redo those irksome, Brady Bunch-era bathrooms, among other modest renovations.
Some homes on her street have recently gone for as low as $280,000, though these were significantly smaller and in need of a lot more work. One house, probably more comparable, fetched $340,000, though it has just a single bath, three bedrooms and a one car garage, she notes.
Given the uncertainty, Julie D wonders whether it is worth it putting money into more upgrades. After all, maybe she could hit the market again in five years and get a better deal on an even nicer house.
True to her engineering background, Julie D is looking at her options in a refreshingly logical fashion - which is sometimes hard for home owners to do given the emotion involved.
What we'll call Plan A involves a series of modest improvements over the next seven years. These include: updating two 1960s-era bathrooms; adding dormers and replacing all the windows with modern, energy efficient panes; expanding the deck; and adding a garden shed and possibly some additional landscaping.
Plan B is simpler, but over the short and mid-term, less appetizing. Skip the work, pay down the mortgage and hit the market again a few years down the line in hopes that prices have fallen even more.
From her emails to me, it sounds like Julie D is leaning towards renovation, but wants to make sure she is thoroughly exploring her options.
"Buying a "done" house wasn't an option b/c we wanted that larger yard you get with older construction," Julie D writes. "And we really do love the house, the massive trees we're keeping, and the neighborhood. So I'm happy we bought, just want to make sure we make smart decisions from here out."
So what's your take on Julie D's dilemma? Should she push ahead with renovations or hunker down and get ready to buy again at a more advantageous time in the future?
I will highlight some of the best responses tomorrow, as well as weigh in myself. I have also culled some advice from Harvard's Joint Center for Housing Studies which I will include in that post as well.
Fire away - but be nice and keep it constructive!
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