Profile picture for linuxos77

is an addition a mistake?

We bought our current 2 bed/1bath 1100 sqft ranch in RI for $279k at peak of market and owe about $230k. After 7 months on market we only got $180k offer, everyone else said it was too small. We also cant compete with forclosures/shortsales. We have 2nd child on way and current bdrms are smaller (plus will have a boy and a girl). If not for the space we'd stay here another 5 years easy. We can add new bdrm for $28k and make house work for us for forseeable future, but is it big mistake to put money into this place? We also cant see spending 40-50k (to cover mortgage/realtor fee) just to sell, then drop another 40k towards new place (that's major chunk of savings). We're financially sounds and have no risk of losing the place so short sale is not option, plus we'd hate to take the credit hit. So, what is best option? Would we recoup cost of addition going from 2 bdrm to 3bdrm. Hope is to enjoy the house until the market improves. But it will only work for us with more space.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010 - Cumberland
We think we've answered this question for you!
  • Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.
 
 

Answers (12)

Profile picture for sunnyview
If you need the space and you can control costs on the bedroom addition, I would do it. Selling and moving costs money so if you do a little work to make your house livable for your family for the next several years, I think it would be worth it. 3 bedrooms will sell better in most markets as long as they are not too funky and I think even a small baby's room or "office/den" would appeal to more buyers than a 2 bedroom.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 28 2010
I don't think you will recoup the cost of doing an addition if you plan to sell your home anytime soon.  If you need the extra space and you plan to stay in the home for a while then your personal enjoyment may be worth the cost.  In general though, home additions are money losers in my opinion (when you're talking about return on investment).
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 28 2010
Linuxos,
Those numbers aren't the greatest in favor of an addition.

In 5 years you may break even.
On the other hand you may not.

Which means that I really can't help you much.

Which further means that not knowing what the market will bring in the next few years you have to pro and con this issue for yourself.  There are too many personal variables that only you are privy to.

Whatever it is that you decide to do, I wish you the best of luck.

  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
Profile picture for linuxos77
Looking at sales on Zillow for 3 bdrm, 1 to 2 bth houses there's a huge range (due to high short/foreclosure sales).  In our section of town (though not my neighborhood) a lot of houses are on 4-5,000 sqft lots, most in my neighborhood are 10,000+ sqft (mine is 10,200).  The houses on the small lots with 3 bdrm mostly sold for about $190k-$225k, with the larger lots, about $200k-250k...  This was sales from early 2010 till now.  However in these sales there's a decent number of $170-180k transactions due to foreclosures and short sales (houses of varying conditions, some in rough shape). 

The current Zestimate for my house is $204k, if that matters.

This forum is such a great resource because frankly we're nervous about putting ourselves in a worse situation than we are now, however we work hard and want to live in a house that makes us happy and works for us. and really like any advice we can get. 
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
linuxos77,
Although Ginny obviously knows your area, I don't, I think you would do just fine adding another bedroom, maybe half bath.  Especially if you are in a neighborhood of mostly 3 bed homes. And it could probably be done under 30k, depending on your house. 
I am curious, what have 3 bed, 1.5 bath houses been selling for in your neighborhood?
You may not recoup all your costs in 5 years but it will definitely make your house more marketable.  2 beds greatly reduces your buyer pool.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
You are in a tough space situation no doubt.  Perhaps there is a way to re-configure your bedroom space with the living room to give you a small nursery...talk to a coupld recommended contractors locally & see if it's feasible.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
Profile picture for linuxos77
We currently have a finished basement with a regular basement window and bulkhead.  We've pondered converting the office to a bedroom but can't imagine putting our 2 year old alone down there (or the upcoming baby obviously).  We also don't like the idea of having our room down there either (quality of life thing for us, or what not).  If either of our kids were older (we have a 2 year old and another on the way this fall), we'd maybe consider that, but not at this age.  The whole finished basement is also protected by a sump pump (and backup pump), but if we ever had an incident, we'd hate to lose a neccessary part of our home living space (vs what is now just an office and rec room/TV room type space). 
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
Profile picture for linuxos77
Neighbors on both sides of us are very long term residents (I believe they own their houses outright).  Adding the new bedroom certainly won't outbuild for the neighborhood (we're in fact one of the smaller homes there).  Most of the surrounding houses are 3 bdrm, 1 or 2ba ranches and raised ranches built around the 1950s.  We're not looking to make a profit on the addition, we just want something that will make the house work for us until the market improves (we'd be willing to give it several years (like the 5 I mentioned).  Our worry is that we're already underwater by say 35/40k (or more), and if we put the $28k into the addition we'll be even more underwater if we really want to sell after waiting out the market for several years (should things not improve).  While we like the current house for now, we know we definitely don't want to be there forever.  But on the flip side, we don't want to sell at such a huge loss during what is hopefully the bottom of the market.  We're wondering if things stay stagnant in the market for the next 5 years..  If we would be even more underwater.... Or if we'd likely be able to recoup a majority of that investment.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
I would not put on an addition knowing Cumberland as I do at this point but what I would suggest is see about making a room downstairs & installing one of the 'escape' windows to make it a legal room.  This will be less costly.  Prices are expected to stay flat for a few years except in certain pockets in RI...You have too much of a differential between what buyers will pay for your house and what you owe to add on truthfully.  best to you, ginny gorman
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010

Adding the addition and perhaps a second bath will be your best option

    1. Staying for more than 5 years
    2. 2nd Child on the way and space will be ready within 90 days or less.

You will recoup on the bath and the bedroom as long as it fits your current house style and you are not overbuilding for your neighborhood. (seems like you are under in footage and the addition puts you in better shape for future resale).

Make  sure your neighbor is sound and in good shape.....meaning not going down hill due to the housing market.

You will enjoy the addition, both the baby and the bedroom. Add the bath that normally yields 65 to 85% return on investment.

Good Luck!

James Callas - Realtor®
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
Profile picture for Mr Caveat
Would we recoup cost of addition going from 2 bdrm to 3bdrm

maybe not immediately, but i'm sure you would if you stayed the 5 more years you are planning (assuming the BR is a decent size... consider an attached BR too? little more, much better return). i think it is a great idea that you want to make this home your long-term residence... the cautionary part i have is even if the home's value goes up by 30-40k because of the addition, there is no guarantee that in 5 years you would get 30,000 in profit.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
I would ask a Realtor or Appraiser to review your current market to make sure you wouldn't over improve your home for the area.  Another option would be to rent your current home and wait for the market value of your home to increase.  I can help your if you would like to get a general idea of market value/Rental value for your home. 

 
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
July 27 2010
 
Related Questions
is an addition a mistake?
Profile picture for sunnyview
Latest answer by sunnyview
July 28 2010 | 12 answers
Be A Good Neighbor

Zillow Advice depends on each member to keep it a safe, fun, and positive place. If you see abuse, flag it. More on our Good Neighbor Policy.

Homes for Sale
  1. 377 Knollwood Dr, Woonsocket, RI Home For Sale
    377 Knollwood Dr, Woonsocket, RI 02895

     For Sale: $145,000

    • Beds: 3
    • Sqft: 1064
    • Baths: 1.0
    • Lot: 10436
  2. 113 New River Rd # 113, Manville, RI Home For Sale
    113 New River Rd # 113, Manville, RI 02838

     For Sale: $5,000

    • Beds: 1
    • Sqft: 450
    • Baths: 1.0
    • Lot: 435
  3. 238 Williams St, Cumberland, RI Home For Sale
    238 Williams St, Cumberland, RI 02864

     For Sale: $229,900

    • Beds: 3
    • Sqft: 1722
    • Baths: 2.0
    • Lot: 5009