10 Reasons why you should not build an addition to your home

Here are just a few of the reasons given to me by hesitant buyers & my reply:

                                                                                                                    1. "I'll never get my money back"
In 25 years I have never seen one homeowner lose a dime on any addition built on their home...... not one. There is a possibility it may happen to you I guess, but I cannot think of a good reason why. House values have continued to rise & will continue to rise. Ask anyone one you know if they have lost money on the addition they built.

And last of all, why should you get your money back anyway? You buy a car for $25,000 & 5 years later it's worth maybe $10,000. You have used & enjoyed the ownership of the car & it cost you $15,000 & you don't seem to mind. You are going to use & enjoy the comfort of a room addition for 20-30 years & you want your money back??????

2. "I'm going to out price myself with the other houses in my area"
No you are not. Your house is going to be the most valuable on the block & more appealing to prospective buyers in the future.

3. "I'm going to wait till the interest rates come down"
Hah! After you have waited you will find that the estimate to do your work has increased a few thousand dollars. That's more than any savings you would have had in interest payment. Don't hang by your thumbs while you are waiting. True, interest rates fluctuate & if in the future they do come down you can always refinance.

4. "Prices can't go any higher, they are at their peak. I'll wait till prices come down"
The cost of the addition will continue to go higher & so will the selling price of your house. Homes I bought for $20,000 & $30,000 are now selling for $400,000. You haven't lived long enough to see that happen, I have. My parents bought their first house for $3200 & they thought they paid too much.

5. "Why should I pay all that interest. I'll wait till I can pay cash"
Here's why. You will be buying with today's dollar value & paying it back with inflated dollars in the years to come. Do flat rate financing & you will be ahead in real dollar value. Meanwhile your addition will continue to gain value. Whatever interest you save waiting to pay cash will be given to the contractor in the form of higher building costs.

6. "My parents lived through the depression. You never know when it will happen again"
That's true, it's possible. The country had one great depression in 300 years so it may happen again. Meanwhile you have three kids in one room & one bathroom in the house. You need more closet space, your bedroom is too small & God knows what else. That's depression.

7. "The price of oil is going higher"

8. "There may be a revolution in Timbuktu"

9. "The terrorists may attack again & blow up my addition"

10." I'm feeling faint, my hands are trembling, my palms are sweating, my face is beet read, I'm feeling short of breath, I think I'm having cardiac arrest"

The last four reasons are the same as the first six. They are all excuses for doing nothing. Some homeowners just can't bite the bullet. You need it, you want it, you deserve it, you can afford it but what if.........

Additions are not an expense they are an investment. Safer than any stock or money market or cd investment & the historical returns are also better.

When I was selling home additions or any large home remodeling project I would hear the above refrains over & over from the homeowners I was talking to.

Many years ago I had laid out a nice den addition on the rear of a home. I showed them how to build it at a price they could afford & got them approved for financing. I prepared the contract & detailed the whole job.

Out of the blue the husband started complaining that he had to spend $340 more at the closing for the house than he had planned for. (That was 17 years ago) He still had not reconciled himself to this minor blip in his life. This was his excuse (see above for more) "I don't want to go through that again" He looks at his wife. "Maybe we should wait" 

The den his wife longed for was slipping away & she was on the verge of tears. I said "Mrs. V.... if you sign now you will get your den." She signed & then said to her husband in a strong voice "Sign it now" He did. She got the den & he survived the ordeal. At the time the house was worth about $25,000, today it sells in the high $300s. The addition cost was $8700.

Sometimes people just need a little push.

Remember the law of inertia you  learned in school?
An object at rest tends to stay at rest and an object in motion tends to stay in motion.

Nothing is going to happen until you get some motion!