Add Value to Your Home With the FHA 203k Loan
When doing an FHA 203k Rehab Loan there are a couple of things to consider. First of all the property maybe in poor condition and some repairs maybe required…such as foundation or roof repairs. Secondly there are the cosmetic upgrades that aren’t necessarily required but that will make the home more to your liking and these changes can add great value to the home. So let’s take a look :
Which Renovations Add Value To Your Home?*
Find out which projects will add value to your number-one investment.
Thanks to the sluggish housing market, you may find yourself hanging on to your home longer than you’d planned. So now would be the perfect time to refinance your home with the FHA 203k rehab loan and finance the cost of the updating with today’s great low interest rates.
Not all remodels are made equal.
Some renovations add value to your home and will return most of your investment when you sell it. Others add no value. Take a look at some of the best home improvements for return on investment.
The Best
Family room or bedroom addition, average price: $50,000
Added living space has always been a good idea, but it’s becoming increasingly valuable. It’s a pricey project, but you’ll recoup about 83% of the cost. Make sure your heating and cooling system can handle the added square footage, however. A low-cost option: Transform your basement from dungeon to bright, new living space by sealing the walls and painting them with waterproof paint.
Kitchen remodel, price range: $15,000–45,000
A kitchen renovation can really break the bank, but if it’s done right, you’ll get back about 72% of the cost. Cabinetry accounts for about half the cost of a kitchen renovation, so consider less expensive stock cabinets versus custom made. Add or update tile backsplashes or add a breakfast bar for low cost and high impact.
Bathroom remodel, price range: $7,000–20,000
Just like the kitchen, a bathroom remodel can quickly get out of hand. Mid-range upgrades tend to hold their value better than high-end upgrades, returning about 70% of their cost. Maybe splurge on a whirlpool tub and choose reasonably priced materials for the rest of the room.
Before You Run Out To Pick Tiles…
Keep these points in mind as you plan your budget, and remodel to get the most bang for your buck:
• Don’t overdo it. If you put granite countertops in a laminate neighborhood, your return on that investment could be pretty sad. Don’t renovate your home to the point that its features no longer fit in with homes in your area.
• Plan for a budget buster. Once you get a contractor’s estimate for your project, plan for a budget overrun of about 12%. You never know what you’ll find behind that drywall. Prepare for these snags up front so they don’t ruin your renovation.
For any questions please give me a call. As a national lender, I welcome the opportunity to walk through the process with you and help you add value to your home with the FHA 203k loan.
*except cited from www.daveramsey.com