Build an Addition, or Buy Another House?

[TPI Monte SS]

What would you do in this market? We currently have an older 2-bedroom, 2-bathroom Colonial set on 50x100 lot. The garage is attached to the house, and barely large enough to fit the Monte, let alone work on it indoors.

Since we have a boy and a girl (my son is 5, daughter is 2) we will eventually need an extra bedroom, and of course I'd like a bigger garage. We bought this house 7 years ago before the market really went nuts in our area - Bergen County NJ, right across the river from New York City. The prices of some larger homes are coming down, and houses similar to ours are still going for almost double what we paid 7 years ago. There's a LOT of homes on the market right now, but ours is in fantastic shape compared to the some of the stuff out there now so it might be an easier sell.

Realistically, should we try to sell and buy a bigger house, or would it be cheaper in the long run to blow out the back of the house, put an extra bedroom in, and build a new garage detached from the house that's actually big enough to work in? FWIW, my father-in-law was a mason/tile expert/home builder for 50 years and knows his way around a house, so we'd be able to do a lot of the addition ourselves to keep the cost down.

[MrQuick]

Not sure how your market is in your area but I'd wait to see what the market will do at years end. Are you up or down on your morgage?

If you are over then I'd sell and buy something with in your needs.

Having construction experience may help alot with a remodel.

[thedugan]

Do you like your neighborhood?

What are the other houses on your block like. Will you end up having the biggest house on the block. You dont want the house to look out of place, it will hurt your value.

[BonzoHansen]

Steve-o, move to beautiful south-central NJ!

I’d move unless you really love the neighborhood, or have commuting advantages, etc.

Now is the time to step up if you want, rates are good & bigger houses have lost more $$ value. Example – if you lose 10% on a $200k house, you’re down $20k. But 10% down on $400k is $40k off.

[Jim Nilsen]

You can get sooo much more for less right now.

Some of the foreclosed houses are being stripped down when the people leave, and I mean stripped down. These places are going to go for real cheap and will need to be remodeled right from the start. The good thing is you will be able to include it all in your new loan. That means all of the stuff you would be dreaming about having you can get now and pay for it without ever taking on a 2nd mortgage. You can also get the size garage you want.

I almost bought the place I was renting 4 yrs ago and I would still be working on it but I bought a house that had everything I wanted for a lot less. You just don't know how easy it is to move when you buy a place with a garage as big as your house and the house is bigger to start with !!!!!

Keep looking until you find a place close to where you will be working.
Patience is the key and you have the time.

[TPI Monte SS]

Right now we're in decent shape on the mortgage; we put a lot down and the house wasn't too ridiculous, so we have ~160K left. But, the house may sell for over $400K; lots of the houses in our area are right around that price point. So, that would put us at a decent spot for getting a larger, more expensive house. We do have a commuting advantage where we live as well; my job is 10 miles from home, and my wife's is about 6 miles, so we'd like to stay in the area. Plus, our parents are right in the 10 mile circle too, and they watch our kids while we're at work since they're retired.

I'm thinking it might be time to see what the market would get us for our house; it's definitely tougher to find a buyer, than find a new house, since there are SO many houses for sale. I think there's over 100 for sale just in my town, which is a whopping 3-square miles!

[SaturnVUEguy]

Almost sounds better to build an addition. Buying won't be so hard to do, but selling the current house...