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Extreme Home Makeovers Can Cause Extreme Debt
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For more information contact:
Kelly Rote (713) 394-3201 |
Release Date: March 28, 2006 |
Today’s do-it-yourselfers are spending a lot of time and money improving their largest asset. In fact, the Harvard Joint Housing Studies reports that Americans spent a record $149.5 billion on home remodeling during 2005, up 4.3 percent from the previous year. While investing “sweat-equity” in your project may save some money, the high cost of some do-it-yourself home improvement projects can quickly turn a weekend project into a stressful financial event.
To make the most of your DIY dollars, you must be a good contractor and a good project manager. Create a detailed spending plan and don’t forget to budget for incidentals such as equipment rentals and delivery charges. The experts at Money Management International offer the following additional suggestions:
Be realistic. If the goal is to increase your home’s value, seek advice from someone with knowledge of the local real estate market. Remember, just because you spend $10,000 replacing your windows, doesn’t automatically mean that your home is worth $10,000 more.
Know your limits. “Do it yourself” doesn’t necessarily mean you have to do it alone. Some types of projects, like electrical rewiring, require an expert. You should also consider enlisting the skills of friends, neighbors and relatives.
Know when to say when. Home improvement projects often cause a "snowball effect." Just because you plant some trees doesn’t mean that you need a new sprinkler system. With each project reevaluate your budget to determine the best time to start the next project.
Don’t cut corners. When it comes to home improvement, quality counts. Before skimping on low-cost materials, remember that it is always cheaper to do things right the first time.
Do your homework. Research local codes and secure all necessary permits before you start something you can’t finish. Also, go to the local home improvement store to determine the best way to go about making your improvements.
Try low-cost alternatives. Big changes can be made for very little money. For example, painting a room and changing the lighting are inexpensive ways to make a dramatic change.
Take care of your investment. Taking good care of your home can help you avoid costly repairs down the road. For example, changing your air filter regularly will improve the quality of your air and improve the efficiency of your heating and cooling systems.
“Understand that while home improvement projects can increase the value and comfort of your home, most projects are not necessary,” said Cate Williams, vice president of financial literacy with Money Management International. “Remembering that your project may be a ‘want’ and not a ‘need’ can help you to enjoy your home sweet remodeled home.”
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Money Management International, is a non-profit community service organization that provides confidential financial guidance, counseling and debt management assistance to consumers. MMI helps consumers trim their expenses, develop a workable budget, lower their debt payments and repay debts. Services are available by phone. To visit with an MMI counselor, call toll-free 1-800-762-2271- 24 hours a day, 7 days a week. Spanish speaking counselors are available. Consumers can also learn more by visiting the MMI home page at www.moneymanagement.org.
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