Expansion vs Upgrading Westchester County

At NestEdge Realty we focus on buying and selling homes in the entire Westchester County Real Estate Market. We represent buyers and sellers from the Hudson River to the Long Island Sound and from Pelham up to Somers. Our clients run the gamut from those buying small condos up to large sprawling mansions. Some clients are looking for a home with a short commute from Westchester to Manhattan and others want to be tucked away in the woods and enjoy a peaceful and scenic weekend home in a town like Pound Ridge or Bedford.

 

Though NestEdge Realty has several agents working throughout Westchester County I tend to focus my business on Chappaqua, Briarcliff Manor, Armonk, Pleasantville, Katonah, and the surrounding areas.

 

In the last year, several of my clients looking at Chappaqua homes for sale happened to be in the same boat. Several of these buyers moved into these towns and bought smaller properties and starter homes. As the years have rolled past, finances change and families grew many of these clients have tended to have the desire to live in a larger home.

 

At this juncture, one question is commonly asked:

 

Am I better off economically by renovating and expanding my current home or am I better off selling my existing home and buying something larger?

 

Admittedly, every situation is different. For example, some homes cannot be expanded leaving the homeowner with very few options. In other cases, an expansion may be possible but then one must ask how difficult and costly will the renovation and expansion be and will it make sense economically in the end?

 

Having a great realtor can help answer these questions. Not only should your realtor be doing the 16 most essential things, plus offering a broker commission rebate that is larger than the one offered by Redfin in Westchester, but your agent should also have the ability to prepare an economic analysis on what a homeowner’s house would be worth in renovated and expanded condition. This estimate along with a contractor’s accurate estimate of the work required should help the homebuyer make an informed decision.

 

But other very key points of data must be considered when weighing the expansion versus move question.

 

The first of these questions is whether or not the expansion of the home is even possible. In many parts of the county, houses are situated near wetlands. These wetlands pose a significant challenge to home expansion. Unless certain setbacks and other local building requirements can be met by the architectural plans, most towns are unlikely to approve a significant expansion.

 

The second question that must be asked is whether or not the homeowner is up for the challenge of meeting the town's requirements. Just because the architectural plans may sit within the guidelines of the town for expansion does not mean that the approval process will be simple, quick, or easy. The approval process in most towns for expanding a home is in the best case several months or in the worst case over a year to complete. There are several, tedious steps to complete to get your building and expansion permit. This type of complicated process is enough for a homeowner to decide to sell and buy a different home.

 

The next question that should be asked is about taxable values. As discussed in many other articles on this website one of the biggest deterrents to buying a home in Westchester County are the relatively high Westchester County property taxes. While the argument can be made that the property tax rates in Westchester County are acceptable due to the top-ranked Westchester school districts being some of the highest rated in New York State, home buyers are still very cautious about their Westchester property tax bill. Unfortunately, when a home is newly renovated or expanded that home will almost definitely be re-assessed by the local tax assessor. It will generally be unknown before and during a renovation and expansion project what the new property tax rate would be at the end of the project. This is a risk that causes many people to buy a new home rather than expand the house that they currently own.

 

Lastly, a homeowner considering a renovation or expansion, especially those with young children, needs to take into account the considerable disruption of life that living through a renovation in a home brings forth. Having lived through this experience myself, I can’t attest to the fact that living in just a small part of your home and not having a kitchen is in no way a “picnic”.

 

In the last year, I have worked with several homeowners weighing this very question. The majority, but not all of them, have opted to sell their current homes and upgrade to larger properties. At the end of the day, the math just did not make sense when considering a renovation and expansion over a new home purchase.

 

I think that one of the biggest reasons for this trend has been the current state of the housing market in Westchester County. As I have discussed in several previous articles, the state of the Westchester real estate market is as follows; The lower end of the market which would be considered $1 million and under in the towns I focus on such as Chappaqua and Briarcliff Manor, remains quite strong with a healthy amount of buyers in the market bringing more demand than there is current supply due to historically low inventory. The higher end of the market which would be considered over $1.5 million in the towns that I specialize in is extremely weak with inventory at high levels and very few buyers to be found. Both of these facets lend to a very favorable economic scenario for a buyer looking to sell a smaller property and upgrade to a larger property with the market in the current state.

 

At NestEdge Realty we are more than happy to help you run the scenarios and do the analysis. Also, at NestEdge Realty our economic scenarios look a lot brighter because of our highly discounted commission rates for sellers and broker commission rebates for buyers.