What would you do? Buy new house or renovate existing house?

[Anonymous]

We love our neighbors and neighborhood. We have been in the same house for 10 years and have out grown our house. We have 3 young kids in 2600 sq ft 4 bedroom 2.5 bath with 2 WFH parents.

Would you do a major $200K renovation on house or sell and buy a larger house?

A new house recently came up on the market that is 4200 sq ft 4 bedroom 4 bath for $1 million.

We could probably get $950,000 for our existing house (bought it for $700,000) and have about $450,000 on the mortgage plus a $100,000 HELOC to pay off.

We have a very low interest rate which makes me nervous to even look at a new house. But we really need more space. What would you do?

[Anonymous]

Anonymous wrote:We love our neighbors and neighborhood. We have been in the same house for 10 years and have out grown our house. We have 3 young kids in 2600 sq ft 4 bedroom 2.5 bath with 2 WFH parents.

Would you do a major $200K renovation on house or sell and buy a larger house?

A new house recently came up on the market that is 4200 sq ft 4 bedroom 4 bath for $1 million.

We could probably get $950,000 for our existing house (bought it for $700,000) and have about $450,000 on the mortgage plus a $100,000 HELOC to pay off.

We have a very low interest rate which makes me nervous to even look at a new house. But we really need more space. What would you do?

You must not live inside the beltway. 2600 Sq ft is large inside the beltway and would be 1.5 million.

[Anonymous]

What do you plan to do in the renovation? I don't think you could turn your house into something like the 4200 SF 4BR/4BA for 200K. Adding 1400 SF plus 1.5 BA and renovating everything else is going to be more than that (double, probably).

If the other house is in your neighborhood, I'd seriously entertain it. You don't want to manage a major renovation with three young children and two full-time jobs. At some point, isn't it worth something to just have the space you need and be able to focus on your family?

[Anonymous]

Anonymous wrote:What do you plan to do in the renovation? I don't think you could turn your house into something like the 4200 SF 4BR/4BA for 200K. Adding 1400 SF plus 1.5 BA and renovating everything else is going to be more than that (double, probably).

If the other house is in your neighborhood, I'd seriously entertain it. You don't want to manage a major renovation with three young children and two full-time jobs. At some point, isn't it worth something to just have the space you need and be able to focus on your family?

Op - we would finish the basement to add a bathroom and rec room and then probably blow out the back of the house to make a large family room and expand the kitchen. But yea it would be expensive and horrible to live through.

I am just nervous about a) a new mortgage with a high interest rate, b) leaving our neighbors who would still be close by but not next door and we are very close to them and c) trying to sell our existing house.

[Anonymous]

I would renovate. What do you think you should do? How much more space do you need? Just put a few offices and a family room in the basement.

[Anonymous]

Anonymous wrote:

Anonymous wrote:What do you plan to do in the renovation? I don't think you could turn your house into something like the 4200 SF 4BR/4BA for 200K. Adding 1400 SF plus 1.5 BA and renovating everything else is going to be more than that (double, probably).

If the other house is in your neighborhood, I'd seriously entertain it. You don't want to manage a major renovation with three young children and two full-time jobs. At some point, isn't it worth something to just have the space you need and be able to focus on your family?

Op - we would finish the basement to add a bathroom and rec room and then probably blow out the back of the house to make a large family room and expand the kitchen. But yea it would be expensive and horrible to live through.

I am just nervous about a) a new mortgage with a high interest rate, b) leaving our neighbors who would still be close by but not next door and we are very close to them and c) trying to sell our existing house.

If you're in the DC area, you're not going to be able to finish a basement, add a bathroom, build an addition, and expand your kitchen for anything close to $200k.

[Anonymous]

Renovate. But what is your $100k HELOC for? Seems like you are already in over your head.

[Anonymous]

Low mortgage and neighborhood you love? I’d stay and renovate.

How about just renovate the basement and add the bathroom before considering an addition? Agree with PPs that it’s going to cost a lot more than you think.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What do you plan to do in the renovation? I don't think you could turn your house into something like the 4200 SF 4BR/4BA for 200K. Adding 1400 SF plus 1.5 BA and renovating everything else is going to be more than that (double, probably).

If the other house is in your neighborhood, I'd seriously entertain it. You don't want to manage a major renovation with three young children and two full-time jobs. At some point, isn't it worth something to just have the space you need and be able to focus on your family?

Op - we would finish the basement to add a bathroom and rec room and then probably blow out the back of the house to make a large family room and expand the kitchen. But yea it would be expensive and horrible to live through.

I am just nervous about a) a new mortgage with a high interest rate, b) leaving our neighbors who would still be close by but not next door and we are very close to them and c) trying to sell our existing house.

If you're in the DC area, you're not going to be able to finish a basement, add a bathroom, build an addition, and expand your kitchen for anything close to $200k.

This. Just our basement (finishing with bathroom) in Burke is nearly $100k, kitchen was $70k.

I think for the addition/remodel you are looking at $3-400k

[Anonymous]

Sadly $200k is not going to be near enough for a major renovation.

[Anonymous]

Ive done both multiple times and new homes always best renovations for stress and roi

[Anonymous]

You love your neighborhood and your neighbors: priceless

Renovate

[Anonymous]

Why does everyone say stay reno and in the neighborhood it sounds like the new house is in the neighborhood

[Anonymous]

I’d crunch the numbers and see if you can handle the mortgage with higher interest rate. Then I’d probably move. If your neighbors moved next year, will you be mad that you didn’t move?

[Anonymous]

Op here - thanks for all the replies. Yes new house would be less than a mile from original house. So obviously close but not next door to the neighbors we love.

We have already done a bunch of renovations on the house - bathrooms, office, roof, windows, etc. that is what the HELOC is from. With interest rates being so low it was easier to do that than cash in investments to pay for these renovations.

We bought our house 10 years ago at $700,000 and have since refinanced to a 2.5% interest rate. Our HHI has also gone up significantly but so have our expenses (3 kids!).