The number of homes for sale in Lancaster County has decreased dramatically over the past three years. Reports indicate this trend will continue, and home prices are increasing steadily due to this shortage. Instead of searching for the perfect home in a seller’s market – some local homeowners are finding ways to transform their current home into the home of their dreams!
Read on to hear how they have come to the decision to renovate instead of move – and how they they turned their house into the home they’ve always wanted using smart financing techniques.
Are you ready to use your home equity to create your dream home? Learn more about Union’s Home Equity lending options.
Buying vs. Renovating in Lancaster
When it comes to finding a home, it may be because your current home may not always fit your needs. It’s easy to pull up local real estate listings and start your search for a house that better fits your lifestyle. But in Lancaster’s current real estate climate in Lancaster, that may be a costly choice.
Lancaster County has been experiencing a period where there are far more buyers than sellers. Home prices are going up. The vacancy rate for residential properties is one of the five lowest in the United States, at just 0.3 percent. While this can be a problem for families looking to move into the area, it can also be an issue for families already living here. Many times, local homeowners seeking larger homes or homes with popular amenities may have a hard time finding a property that will fit their budget.
Instead of moving, now might be the perfect time to invest in the renovations that will give you the home you want.
Planning Your Home Renovations
If buying a home in Lancaster is on your to-do list, renovating might be the way to go. Before anything else, it’s important to consider what your long-term goals are for your home. Think about your lifestyle and how you use your home
- Are you planning on having (more) children?
- Do you want an outdoor space for entertaining and relaxation?
- Are you hoping for a larger bathroom, with walk-in shower and dual sinks?
- Do you want an open kitchen and dining area with the latest appliances?
Examine your goals and prioritize what changes are most important. You may just find that a renovation can accomplish these goals.
Home Improvement Renovations with the Best (and Worst) ROI
When deciding which home renovation projects make the final list, it’s important to understand the impact they’ll have on your home’s value. For example, adding or building a four-car garage might not bring top dollar when the average prospective buyer is looking for two-car garages. Don’t be afraid to make your home the way you want it – but if you will someday sell your home, some features may not appeal to all buyers.
To help you out, we’ve examined which home improvements can improve your home’s value, leave it pretty much even, or even damage its value.
The Good: Renovations That Pay Off
Kitchens and bathrooms are two of the best investments you can make in your house. When buying a home, they are the two things potential buyers notice first. You don’t have to redo the whole design of these two important rooms. Simply giving your kitchen and bathroom a face-lift with renovations like painting, refinishing surfaces, and upgraded appliances can provide excellent returns.
Home maintenance is also an excellent investment in your home. Now is a great time to install more energy efficient air conditioning, fix the roof, paint (using updated or neutral colors), or install new windows. These may not seem like the most exciting options now, but they are an excellent long-term investment in your home. Buyers prefer homes in ready-to-move-in condition, and some will pay more to avoid these headaches.
One of the biggest reasons people buy a new home in the same area as their current home is because they need more space. Features that add more useful space adding an extra bedroom, expanding your living room, or even building on an additional floor – can solve the space problem while improving your home’s value.
The Okay: Renovations That Break Even (or Close)
Some home improvements add enjoyment, but don’t expect them to bring high returns. Finished basements, for example, are not typically the first thing on many buyers’ lists. However, they can solve the problem of needing more space, as well as provide a place to gather and entertain, making them a bit more popular.
Other amenities that may or may not improve your home’s value include granite counters, new cabinets, laundry room upgrades, smart doorbells and thermostats, working fireplaces, and professional landscaping.
The Bad: Renovations You’ll Lose Money On
Some home improvements not only require a big investment, but rarely return all of that investment when it comes time to sell. For instance, swimming pools hardly ever return their cost. Many buyers aren’t willing to spend the extra money for a pool and some may see it as an unnecessary financial and maintenance burden. Home theaters, while costly and on many wish lists, can suffer from the same effect.
Home offices are typically a poor investment, too. While you won’t lose a ton of money on it, many buyers see it as an unnecessary waste of space for something they may never use.
Finance Options for Home Renovations
One of the best ways you can finance renovating your home is by leveraging its current value. There are several ways to use the equity in your home to achieve this.
Home Equity Line of Credit
What is it? A Home Equity Line of Credit (HELOC) is a revolving form of credit that uses your home as collateral. As you pay your HELOC back, the amount you can borrow gets replenished. HELOCs work a lot like a credit card, but let you fund larger expenses, receive lower interest rates, and the interest you pay is typically tax deductible.
When to use a HELOC: This type of loan would make more sense if you were doing a series of smaller improvements spread out over time. The ability to draw from this line of credit when you need it makes it the perfect option for multiple projects.
Are you interested in having access to the funds for all of your renovation projects? Apply for a Union Home Equity Line of Credit today.
Home Equity Term Loan
What is it? A Home Equity Term Loan is a one-time lump sum loan you can receive using the equity in your home. Home Equity Term Loans offer a fixed rate for a fixed term. Having your home as collateral for this loan means that your interest rate will typically be lower and tax deductible.
When to use a Home Equity Term Loan: When you receive a home equity term loan, you receive the total available amount at once. This type of loan makes more sense when you have one or two big budget projects and you have a good idea of the total cost.
Ready to receive the funds for your big budget project? Apply for a Union Home Equity Term Loan today.
Build Your Dream Home Today
If you’re ready to begin the process of creating the home you’ve always wanted, learn more about your Home Equity lending options with Union Community Bank. Our lending experts are ready to help you find the loan that’s right for you.
Union Home Equity Loans and Lines of Credit benefits include:
- Competitive interest rates
- Easy application process
- Interest may be tax deductible (consult your tax advisor)
- And more!
Contact a Union Community Bank home lending expert today to learn more or apply for Home Equity Term Loan or Line of Credit today!