Real estate can be a complicated industry as it’s always evolving, full of changes and new trends. For example, recently there’s been a lot of noise in the media about remodeling’s return on investment. Many TV shows and industry news sources are overemphasizing how much a home’s resale value will be impacted due to a remodel and understating the impact on intrinsic value. For instance, how much is it worth to you that your home is customized precisely to your family’s needs and your kids get to stay in the same school district?
Nowhere is this noise louder than in overheated areas, neighborhoods which are highly desirable by families and as a result, highly desirable by developers. Developers are snatching up these homes to flip them as quick as possible with an eye only on maximizing profits while minimizing costs (and quality). So how does this impact the family that’s not only looking at resale value? It depends on the homeowner. For newer homeowners that may not have a complete appreciation for remodeling, it causes them to prioritize the ROI on their home and look to sell. On the other hand, more established homeowners know of other remodeling advantages, ones that aren’t only tied to a dollar sign.
The real estate industry has a well-known saying – “Location, location, location” – which is used to explain why some properties are so much more expensive than others. And having successfully completed over 700 home remodels, I can say that most of the owners I have worked with have chosen to remodel for personal reasons rather than solely for the resale value of the home.
Has it always been like this?
In the early 2000’s, many homeowners considered the profit margin before investing in a remodeling project. This may have partially skewed the market in general since there were many new owners who were essentially speculative investors. The prevailing thoughts behind house remodeling were focused on securing a low bid rather than the desire for a well-designed and well-crafted renovation project. However, short-term profit goals are difficult to achieve with remodeling projects.
Lately, I am noticing that new homeowners are more interested in making smart, quality improvements that will serve them well over the time that they call that house their home. They are less driven by a low price than by high quality.
Pick two: quality, service or price?
With over 30 years of experience in watching these trends in real estate and remodeling, I’ve noticed that a person can select two of the three following characteristics common to any product or service: quality, service or price. If a homeowner expects quality work and professional service, he or she should expect to pay a reasonable price. This ensures the provider can deliver both quality products and high service.
Having a personalized addition designed and built for your home, or having a whole home remodeling project crafted to your specifications, is a very subjective and customized process. You cannot order your remodeling project on Amazon and have it dropped off on your front porch.
So when does the convenience of the internet’s “point-and-click” ordering give way to the importance of project integration and quality control of the construction process? Design-build remodeling is a complicated process which is custom designed to suit each individual’s style, goals, desires and budget. Square foot pricing is essentially meaningless for residential remodeling. One size definitely does not fit all.
Alexander Group can help.
At Alexander Group, our time-proven process assists owners as they are guided through the multi-step design-build process for completing a residential project. Some people view a house as an “asset class,” but we understand that a home is different. It has a more powerful meaning and value to its owners.
A home is a person’s castle—a personal oasis—and these feelings can, and should, drive quality design-build remodeling projects. At Alexander Group, they always have and they always will. Because we know, there’s no place like home.