Armchair Millionaire Community Bulletin: The Nuts and Bolts of Home Improvement

For most of us, our homes are our biggest asset, so making major improvements is no small matter. Armed with the right knowledge and plenty of advance planning, your home remodeling project will pay off both in enjoyment and increased resale value.

New York, NY (PRWEB) July 5, 2005

Home remodeling is big business in the United States. A report by Harvard’s Joint Center for Housing Studies says that Americans remodeled their homes to the tune of nearly $127 billion in 2004.

With that much money being spent, there’s lots of room for things to go wrong, and everyone has heard a contractor horror story. However, if you’re careful about how you go about your remodel, your experience can be a positive one. These comments from the Armchair Millionaire community reflect the good side of home remodeling:

“With a combination of professionals and our work, we've remodeled every room in our home. We did the demolition to our 55-year old bathroom, while plumbers and electricians did the hard stuff. When we redid our kitchen, we bartered with a cabinet guy and got the labor free. My husband also added on a huge deck to our house. We've spent about $15,000 (plus sweat equity), but it's added about $40,000 to the value of our home.” --YJ

“We added onto our existing deck and put a sunk-in hot tub on the new deck area. We could have done it ourselves but opted to use a contracted and so glad we did--it's absolutely beautiful, sturdy and better then we would have done. It has increased the value of our home.” --Kristi

The keys to successful home remodeling are good planning, hiring the right contractors and keeping an eagle eye on the work as it moves along. My guide provides the basics of a successful project.

The Armchair Millionaire’s Guide to Successful Remodeling

Choose your contractor wisely. Perhaps the best way to find competent contractors is by word of mouth. Check with friends, neighbors, or co-workers for referrals. Interview each contractor you're considering. Ask how long they’ve been in business (you want a well-established company), whether they’re licensed and registered as required (ask to see proof), and whether they have the necessary insurance (again, ask for proof). Get references and check them out. When you have several good candidates, get written estimates from each. Ask for explanations for price variations and don't automatically choose the lowest bidder.

Get the most bang for your buck. Lean toward those projects that will contribute the most to the value of your home over time. Each year, Remodeling magazine produces a report on how much of your cost you might recoup on various remodeling projects, were you to sell your home. Here are a few examples:

  • Minor kitchen remodel: 92.9 percent
  • Deck addition: 86.7 percent
  • Family room addition: 80.6 percent
  • Basement remodel: 76.1 percent

Manage the project wisely. Get a written contract that describes the work to be done, the materials that will be used, how changes will be handled and what it all will cost. As the job progresses, keep all paperwork related to the project organized, and consider taking photographs of the work--these records will be important if you have any problems during or after construction. Don’t make a final payment until the job is finished to your satisfaction and has passed inspection with your local building officials.

Finance it wisely. For all but the smallest projects, a home equity loan or line of credit will make the most sense. You can get these loans at little or no cost, will pay a very reasonable interest rate and, in most cases, the interest you pay on loans up to $100,000 will be tax deductible.

The Bottom Line: For most of us, our homes are our biggest asset, so making major improvements is no small matter. Armed with the right knowledge and plenty of advance planning, your home remodeling project will pay off both in enjoyment and increased resale value.

The Armchair Millionaire Weekly Survey: Do you have an emergency fund? Log on to http://www.armchairmillionaire.com and let us know.

Lewis Schiff founded the Armchair Millionaire Web site in 1997. His first book, The Armchair Millionaire, was published in 2001. Schiff's newest report, "How to Know When You Are Rich," is now available at http://www.armchairmillionaire.com.

Contact Information:

Lewis Schiff

Armchair Millionaire

877-833-2823

http://www.armchairmillionaire.com

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