Renovating During Inflation
With inflation at a 40-year high and mortgage rates more than 2% points higher than they were six months ago (and continuing to climb), you might find that now is not the right time to buy a new home. Instead, it might be time to love the one you already own.
Need a little help feeling good about staying put for the time being? Then perhaps, it’s time for a remodel project to turn your house into the home you’ve always dreamed about.
Before you run away screaming at the thought of renovating, hear us out.
A remodel could increase the overall value of your home, which would be beneficial if you consider selling in the future. (And maybe a home face-lift will make you want to stay put.)
“Renovation projects are a great way to retain the value of your money in a high-inflation environment,” says Rick Berres, owner of Honey-Doers, a Lakeville, MN–based company that provides residential remodeling services. “But you shouldn’t put yourself into debt doing so.”
While the prices for everything from lumber to labor might be higher, it’s still possible to embark on a home remodel project without draining your bank account. Here’s how.
Is a home improvement project worth it right now?
While the cost of renovating your home will depend on square footage, the region you live in, and what you’d like to get done, the average home remodel costs anywhere from $25,000 on the low end to $76,000 on the high end.
And the latest remodeling impact report from the National Association of Realtors® found that Americans spent about $420 billion in 2020 on home remodeling projects. The majority remodeled for the following reasons:
- To upgrade worn-out surfaces, finishes, and materials
- To add features and improve livability
- To simply make a