I'm trying to decide between buying a house listed at $400,000 and investing $130,000 to expand it, or waiting to find a bigger house within my $550,000 budget. The house I'm considering is 1,131 square feet, and I want to add about 600 square feet to include a 10x12 bedroom, a larger living room with a fireplace, and a 12x12 office. Is adding all that realistic within my budget?
3 Answers
Talking to a contractor first is a smart move. Generally, renovations can add up quickly, and you're likely looking at higher costs than you anticipate. For a little context, a recent renovation of mine cost over $90k just for an attic conversion without adding any external structures. Adding everything you want for $130k might be pushing it, especially if you want quality finishes. It's best to get some tailored quotes to see if it's feasible where you're located.
If you have the cash from selling your previous house, that definitely gives you flexibility. But keep in mind that renovation loans can come with high interest rates. Even if you have the funds, you might find it challenging to finalize an addition based on home appraisals. It sounds like a lot of work, so if you can find a home that meets your needs without renovation, it might make your life easier.
Honestly, adding square footage usually ends up being more expensive than just buying a bigger house right off the bat. And remember, getting permits can be a hassle too. My wife and I went through a similar situation—we bought a home we loved but dumped over $500k into renovations barely expanding our space. So it might make more sense to keep looking.