Should I Remodel or Move? How to Decide What’s Better for You

As a homeowner, it’s common to reach a point where your home no longer meets all your needs. You typically have two options – sell your home and buy a new one, or remodel your current home. There are pros and cons to both options, including different costs and time commitments. 

In this Redfin article, we’ll outline what to know before deciding whether to remodel or move. Whether you’re living in a home in Dallas, TX, or a house in Milwaukee, WI, here’s how to decide between remodeling your home or buying a new one. 

Key takeaways

• Consider remodeling if you love your home or neighborhood, and don’t want to move.
• Consider moving if you want a turnkey home, certain features, or a new neighborhood.
• Ultimately, remodeling or moving depends on your budget and personal goals. 

5 factors to consider before deciding 

1. Cost of moving vs remodeling: One of the biggest factors that will help determine whether to remodel or move is the cost of each. Remodeling costs depend on your plans, the age of your home, and the contractors you hire. Moving costs depend on local housing prices, mortgage rates, and transaction fees.

2. Housing market: Your local housing market can also influence your decision to renovate or move. If there aren’t many homes for sale in your area or the competition is high, it may make more sense to stay in your home and remodel. On the other hand, if you’re in a buyer’s market with more inventory and lower prices, moving could be more feasible.

3. Location: One aspect of your home that you can’t change is the location. If you love the area you live in, and there aren’t many homes for sale, renovating may be the right choice. However, if you’re open to living in a new neighborhood or area, then you can consider moving.

4. Attachment to your home: Consider how much of an emotional attachment you have to your home and if it will make it hard to move. If you have strong ties to your house, remodeling could help you stay put while meeting your needs. If you’re ready for a fresh start, moving might feel like the better choice.

5. Timing: Evaluate your own timeline and goals. If you need more space immediately, for example, a growing family, moving might be necessary. If you can handle some disruption and have time to wait out renovations, remodeling could be a good solution.

Is it cheaper to renovate or move?

The best way to figure out whether moving or remodeling is more cost-effective for you is to estimate the costs of both scenarios.

Costs of remodeling 

• Materials and labor: This will be the largest cost to consider. How much material, what kind of material, how many projects, and how many professionals you need on your team will all influence the cost of remodeling. According to Angi, the average kitchen remodel costs $26,976, while the average bathroom remodel costs $12,117.
• Permitting: Depending on the extent of your remodel, you may be required to get a permit, which can add to your total cost and time. According to HomeAdvisor, the average building permit costs $1,650. 
• Potential financing costs: If you need to tap into your home equity or get a cash-out refinance, you may have additional costs ranging from interest to closing costs. 
• Exceeding your budget: One major risk of remodeling is that you may go over budget. Prepare ahead for 10-20% more than your estimate as unexpected expenses may require additional funds.

Costs of selling 

• Agent commissions: You can negotiate real estate commissions, but you can expect the range to be anywhere from 1.5% to 6%.
• Pre-listing home repairs: This process might include painting, landscaping, and minor repairs. If your home has serious issues that need to be addressed, that can increase expenses.
• Costs of a new home: From your down payment amount, closing costs, inspections, and more, there are a variety of costs to anticipate if you buy. 
• Costs to move: On average, it typically costs around $1,500 to move. If you’re moving a long distance, it’ll cost more.

Pros and cons of remodeling your home

Pros of remodeling

• Renovating may be less expensive: Even though remodeling is expensive, it may be more expensive to sell your home. You’ll need to anticipate the costs of selling your home, like paying your real estate agent, sale and transfer taxes, and closing costs on the next home you buy. 
• Flexibility and customization: You have the flexibility to pick and choose which projects you want to take on. This can help keep you within a budget. You also have the option to customize your home, which may be difficult to find in a home on the market.
• You don’t have to move: When you choose to remodel, you get to stay in your neighborhood. This can be a big advantage if you love your home’s location and want to avoid the hassle of relocating.
• Renovating may be faster than moving: Depending on where you live, finding your new home might be time-consuming. This is in addition to the time spent selling your home. You may be able to save time by remodeling instead. 

Cons of remodeling

• Living through construction: Living in the midst of construction can be a pain in your day-to-day life. From dust and construction noise to losing access to parts of your home for a time, renovating may not work with your lifestyle. 
• May not receive full return on investment: Not all home renovations are created equal when it comes to increasing your home’s value. While a project may be valuable to you, it may not be to future buyers.
• Possible home insurance increases: When remodeling, certain projects can lead to increases in your home insurance premiums. This depends on your policy, but some projects that may increase home insurance costs include adding square footage, major kitchen renovations, and installing a pool.

Pros and cons of moving to a new home

Pros of moving 

• New location and features: If you want to live in a different area, remodeling isn’t going to fix that. Similarly, if you’re looking for a specific house style, you may be able to find another home that meets those wishes.
• You can buy a turnkey home: Buying a turnkey home lets you move in without the hassle of ongoing home improvement projects.
• Predictable budget: Depending on the length of the renovation and the complexity involved, it can be easy to accidentally exceed your budget. Moving makes it so you stick within the bounds of what you can afford. 

Cons of moving

• Buying and selling at the same time: If you plan to move, buying and selling a home at the same time can be tricky. You’ll need to find a place to live if you sell first, or you may need to pay two mortgages at once if you buy before selling. 
• Moving costs: In addition to the costs of buying and selling, you’ll need to anticipate moving expenses when the day comes. 
• You may not find what you need: Depending on your local housing market, there may not be homes that match your needs and wants.
• Potentially higher mortgage rates: If current rates are higher than your existing loan, monthly payments could increase.

Should I remodel or move?

Deciding whether to remodel or buy a new home is personal and depends on your finances, goals, and lifestyle.

• Remodel if: you love your home and location, have equity to tap, and are comfortable with temporary disruption.
  
• Move if: you want a different neighborhood, need more space immediately, or prefer a turnkey home.

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