Living in Orange County, California already makes most of your real estate decisions extremely different than the rest of the United States. Most of us have seen Love it or List it on HGTV where the Home Designer remodels a couples’ existing home to meet their needs while a TV Real Estate Agent simultaneously looks to meet their needs with a new home. Each are given a budget and the homeowner is left to decide to stay in the remodeled home with the new improvements and improved equity or to sell that equity and buy something that meets more of their needs.
In Orange County home ownership real life, we’re not given such a set of circumstances to make these decisions; we are here to help you make both a financial, functional, and lifestyle choice with some informed options. We will start by evaluating some real Orange County home remodel return on investment data.
The reality is there are local averages of return published by our friends at Remodeler Magazine. These percentages show that you’re not covering your whole spend with a return, but you are replacing and maintaining areas of your home that can change how you use it and increase your personal value. When you design your own spaces, you get exactly what you want – when you move, you inherit the best option available to you in the neighborhoods you are shopping in. And then there’s moving!
Let’s look at a Newport Beach kitchen remodel. Keep in mind that this is an ocean view property and smaller space but clearly in a location where design, materials, and fixtures matter to prospective buyers. And they certainly matter to homeowners that intend on staying in their home
During the kitchen remodel, the homeowners were able to address several needs; these included incorporating, storage space for display items, adding desk space (and potentially a space for wheelchair use), more storage space, and a larger refrigerator.
The homeowners selected exactly the materials they want and location for everything they want in their new kitchen. This keeps them in their home with their dream kitchen and no need to enlist the 4-letter word, M-O-V-E, making the whole family happy.
Below you can see the breakout of the financials. This shows that there is a significant financial cost to remodel their kitchen and that they will be getting this value out of their home for years to come. This also shows that there is an even larger 1X expense to sell their home, closing costs. As well as annual tax increase that will never go away.
Kitchen Remodeling Financials
Purchase Year: 1994
Purchase Price: $ 198,000.00
Annual Taxes: $ 2,243.00
Remodel Cost: $ 65,474.00
Resale Value: $ 829,000.00
Selling Your Home Financials
Purchase Year: 2020
Home Purchase: $980,000.00
Annual Taxes: $9,800.00
Moving Costs: $2,500.00
Selling Costs: $68,600.00
When deciding to remodel your kitchen or move to a different space, there are many considerations to account for. We hope that by providing some local financial information on remodeling a kitchen in a coastal Newport Beach property, that we’re able to show you what the financials come out to be.
While a remodel may seem overwhelming with everything involved, it’s not moving your home to a new location. Consider your lifestyle and what a kitchen remodel will do for you and your family before selling the home. If you’d like a complimentary in-home design appointment, we are happy to give you ideas on what your space has to offer with function, features, and design. Our space design experts can design space in ways you may have not already considered. We’re here to help, when you’re ready for evaluating your kitchen remodel.