Wednesday, June 20, 2007
The realities of renovation - crunching the numbers
And so . . . we made the trek over to Fort Sumner, New Mexico, where our oldest daughter and her family live to take a look at the grand old house she'd sent us photos of. And believe me, she was a grand lady in her day. A big Spanish style home with a red tile roof and a lovely litle courtyard out front (where the chimney was falling away from the house). Years of neglect have taken their toll and while she's still very much redeemable, the purchase price doesn't support the redeeming.
In the beginning, we made up our minds to forge in, rip and snort and bring everything up to date. It's what we do, what we've done for years and what we love. It's easy to get caught up in the fever of breathing new life into a place until you start looking at the numbers. When the cost to make a house merely inhabitable combined with the purchase price equals an amount greater than the overall value of the property - well, you have to draw the line.
We had to draw the line. As most renovators know, older architecture quite often translates into huge expense when it comes to modernizing an older home; like putting in a central heating and air conditioning unit. Because of the partial flat roof, the cost to add CH/A to this place was nearly $15,000. All new wiring and all new plumbing were another $15,000. Then and only then could we start the new floors, paint, new kitchen, etc. You get the point. We'd be in so far over the value of the property that it just wasn't a good financial decision.
We were so bummed. The owners live out of state and purchased the property as an investment - they're not motivated to sell and since they can't see the deteriorating condition of the home, they're not willing to budge a dollar on their asking price. While we could afford it - it wouldn't be smart so we had to decline.
So with our house sold and scheduled to close on July 30th, we're on the hunt again. We've got our eye on a couple of nice places around here and will take a look at them tomorrow afternoon and Friday morning.
We would have loved to have moved closer to Staci and her family but at the same time, we would have been sad to leave the lush beauty of the hill country. We were deflated for about fifteen minutes; we got a glass of elderberry wine, sat on the big old porch and drank in the beauty that surrounds us here. Then, we were over it and ready to move on.