Remodeling Or Tearing Down – Here’s Which Is Cheaper.

The pricing differences between a remodel and a total teardown of your home require many considerations. Having a good idea of what you want in your home, knowing what shape the house is in, and having a firm idea about your budget are the first steps to getting the home of your dreams.

Between doing a full remodel and a teardown, typically, a remodel comes out being cheaper in the end. You can pick and choose what you would like to change. Price varies based on each house, your choices, and the area in which you live.

In this article, we’ll cover what you need to think about before deciding to tear down or do a full remodel to your home. These are not exact quotes as every customer will have different materials, square footage, taste, budget, layout, and general ideas for their home.

How Much Will The Cost Differ?

The cost difference could be anywhere from tens of thousands to hundreds of thousands of dollars between tearing down or remodeling your home. There are too many variables to give an exact amount for one person without knowing what they need.

Every family and every home will have a different price compared to the family down the street. Making your house what you want it to be will include making a lot of choices that your neighbor might not have done. So, the cost might be higher, even if your houses are identical floor plans and you think the changes are similar.

Remodeling can seem like an easy way to get what you want out of your house, but when you consider tearing down walls, replacing floors, and ultimately changing the floorplan, is it much different than starting over from scratch? 

All the issues that you could run into during a remodel might make it worth it for you to tear down. If you are not sure what is behind your walls, quite a few extra expenses could come up. Typically, something will need to be replaced, adding to the overall cost.

If you choose the highest materials, appliances, and any extra features you can think of, it will be much higher than someone who picks the essentials for their new home. The same size home for two different people will cost very different amounts.

A Few Things To Take Into Consideration

If your home is a well-built older home with lots of features that are hard to recreate, is it worth it to rebuild and not just fix up areas where you aren’t happy or that need updating? If you are not worried about the history of the house, which is fine, then both options would work for you.

If your house is not structurally sound, you’ll likely need a teardown. It may be hard to tell from the inside just how sturdy the structure is in your home. Are your walls straight? Do your windows open easily? Are there cracks on your inner walls?

If you answered yes to any of these questions, have a professional come and do an inspection. The last thing you want to do is put in thousands of dollars with a remodel to find out your house just isn’t safe.

Another thing to take into consideration is earthquakes. When you live in an area where earthquakes are frequent, it’s always a good idea to have a professional check your foundation. Older homes built before earthquake laws can become unstable over time. If your home was built after the earthquake laws, you shouldn’t need to worry about that.

If the structure is bad in your home, it will cost less and is safer just to rebuild. The time and effort a remolded take is pointless when building over a failing foundation.

What type of time frame do you expect? Doing little remodeling projects here and there, maybe one or two a year, can keep your house livable while upgrading to your needs. Of course, some people don’t like having a couple of rooms updated, while others are very outdated. They would rather get it done in one shot.

Talk with your contractor about the timeline, and if it’s possible to live in the house during specific projects. You may need to look into someplace to stay for the length of the project. After really thinking about these different situations, you can get a better grasp on which way you’d like to go with your project.

What Could It Cost To Remodel A Home?

It is impossible to get an exact number because, like stated above, there are so many different variables to take into consideration, but a remodel typically costs under $100,000, but having a budget of $150,000 will make it easier if any issues should arise.

To add a roof or siding into the remodel, you would be looking at a total of closer to $200,000. Those estimates are for a smaller, roughly 1,500-square-foot home around the Bay area. Prices can be higher or lower, though, based on what your exact situation is and who you hire to do the work.

Always make sure to have extra money put back in case something comes up. You do not know what is behind your walls and what additional parts will need to be replaced. You never know what will be hiding behind your walls. As stated above, having at least $50,000 over budget is recommended.

Say you only want to remodel your bathroom. But, as the walls come down, they find water damage, pipes that need replacing, and damage to the floor. Now you’re looking at adding  thousands if not more to your budget.

Cost To Remodel Certain Areas Of Your Home?

To remodel a bathroom, it could cost anywhere from $11,000 – $25,000; replacing everything, including your shower, tub, toilet, sinks, countertops, flooring, or even the floor plan, could make the price higher. Some bathrooms with higher-priced materials could raise the price, too.

To remodel a kitchen, it could cost anywhere from $65,000 – $100,000, typically not including the cost of appliances. If you want granite countertops and the best wood cabinets out there, your price will be on the higher end. The average price is typically for a standard remodel of a kitchen.

Remember, If you end up needing to fix plumbing or anything extra, it could be more. If you choose to update everything with higher-end materials, your price would be substantially higher.

Replacing a roof can range be above $30,000 depending on the state of the roof, what conditions the wood is under the roof, and what material you choose to replace the roof.

Adding an addition can be beneficial to a growing family or just when you need a little bit more space. A home addition can set you back about $300-$400 square foot. Some areas will be a little higher or lower, though. That is just the average for the area.

What Could It Cost To Tear Down A Home?

The cost alone to demolish your home could set you back around $9,000 – $20,000 in the Bay Area. 

Taking into consideration that you own your home and land already, the rough pricing could be as low as $250 per square foot. If your house is around 2,000 square feet, you’re looking at approximately $500,000. The price can be vastly different from this low price. The price will quickly shoot up based on many different situations. 

What area do you live in, and do they have strict regulations? It may be tricky to tear down and to stay within those regulations. In the bay area, it’s faster to get the city to approve your remodeling projects versus tearing the home down. It could only take weeks to a couple of months to get the go-ahead to remodel versus the up to a year-long wait to tear down.

Suppose you don’t own a lot, or any, land. Then, you would need to add between $150,000 to over $1,000,000 to the total cost. It all will depend on the location you are in and the size of the lot. That is if you are looking into buying the land to tear down and rebuild the house. 

Should Your Home Be Torn Down?

The foundation of your home is by far the most essential part. Walls can be fixed, drywall replaced, electric, and plumbing updated. But if your foundation is failing, it can cause the rest of your house to go with it.

Here are some common signs you need to tear your home down:

  • Multiple cracks in the walls or floors.
  • Do your doors seem not to fit the frame correctly anymore?
  • Sinking porch
  • Water damage or water coming in places where it never did before
  • Basement walls leaning or your crawl space starting to collapse
  • Chimneys beginning to lean.

These are all signs that your foundation is not as structurally sound as it once was. Old houses settle, and as they settle, the foundation can sometimes be unstable. Throw in living in an area where earthquakes are common and living in a house not built to withstand the shock of one, and your foundation could crumble.

In some cases, a foundation is fixable, but it can sometimes run around tens of thousands of dollars to fix or replace it. Then taking into consideration fixing the walls and all the other parts of your home that need replacing, the cost can add up. It is almost cheaper to just tear it down and start fresh that way, you know for sure your house is safe.

If just parts of your home’s foundations need to be replaced/fixed, that can typically be a not-so-costly fix, usually staying under $50,000 if there are no other problems that come up.

What’s Your Budget?

One of the first things you need to decide on when starting any project is your budget and not going away from it. Even for something as simple as buying kitchen appliances, a budget comes in handy. 

If you decide to remodel, it is smart to establish a ceiling for expenses on certain items, so you don’t go over your budget. It is also smart to have a little extra put away for things you might be forgetting to consider, or for the chance you need to replace the pipes or wires that are hiding behind the walls.

If you are rebuilding, you need to sit down with your contractor to set the pricing on your house. Don’t forget that teardown, disposal, and a new foundation (if it needs fixing) all will cost a decent amount, not including the actual rebuild. Make sure you cover all the bases and will have all the projects on your wish list completed. 

Suppose you work with a contractor that uses bids. They could give you the total cost of materials along with labor and help you stay in your budget limits by letting you pick out the materials you want and telling you the exact price to stay under for each element.

Some companies, however, do not add materials into their bid to allow the customer to have the flexibility to control the quality, price, and selection of materials, truly making your home exactly what you want it to be. 

What Is A Bid?

A bid is an estimate of how much it will cost that company/person to do the job. The estimates are as accurate as can be after reviewing what you need doing for your project, your budget, and your time frame. A bid is typically a firm offer to you from the company.

Having a handful of bids for a project and picking which one suits you better is a good plan. But, picking the cheapest is not always what’s best. Look at their credentials, how skilled they are, and what is included in the bid over just seeing the lowest cost. 

When looking around for bids, it is best to have a very detailed plan of what you want. Simply saying you’d like to change your kitchen isn’t typically good enough to get an accurate quote.

Some companies include everything from start to finish in your bid, including all materials, disposal, clean up, labor, etc. You will tell them your budget, and they will stick with it as they pick out materials or allow you to pick materials not exceeding a specific price to stay on budget.

Other companies choose to let the customers pick all materials, and those prices won’t be reflected in their bid. This way, you can pick exactly what you’d want. In some areas of your house, you may choose to go with cheaper quality on things where other areas you want the top brands. You will get more control over the outcome of your home this way. 

This article goes very in-depth on bids and the different types that there are out there, and lets you know what to expect when receiving quotes from different contractors, which may seem overwhelming for someone dealing with bids for the first time.

Can You Tear Down A Home That Still Has A Mortgage On It?

Some mortgage lenders allow a home to be torn down with money still owed, but many will not. When you started your mortgage and signed a contract, you stated that the bank would give you the loan for a home with the home being the collateral.

In that contract, it usually states that part of  the terms are the house must stay in good condition because that house is the collateral- but not the new house. The bank could be losing money if you were to tear it down and not rebuild. Yes, they could still make you pay the loan, but the worst case for them is that they are out the money with no house to show for it. 

Lenders do not want to take the risk. It is best to run your ideas by your lender to see what you can and can’t do. There will be several variables that your lender will take into consideration, but unless you have money to buy your home outright, typically, you may not get the okay to tear your house down.

If you are thinking of buying a home just to tear it down, whether for the land or to rebuild, there could be options for you. As stated above, most lenders won’t allow a teardown, but if you are not in a current loan with them and looking into starting one, they might work with you using something else as collateral.

Source – Bank Rate

After taking all of this information into consideration, it’s easy to see that if your home has good bones, it’s far cheaper to remodel then to tear your house down. Even if it’s a full home remodel, it will cost you less, take less time, be easier to manage with your lender, and less of stress when it comes to obtaining permits in your city.

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