One of the greatest underappreciated features of a major Houston remodeling project is that it should be synchronized with replacement of obsolete home products like new roof shingles, windows and appliances. The results of combining the required obsolete product replacements with a major home remodeling project can save you a substantial amount of money and future inconvenience. We will discuss the different kinds of financial benefits that can be obtained from this practice.
Economies of Scale
The principles of economies of scale is an economic theory that suggest that the cost of producing one unit is less when many units are produced at the same time. So in the case of combining multiple home improvement projects, the owner experiences more competitive cost advantages then they would experience doing these projects independently.
This condition that benefits the owner are the direct results of the general contractors buying power, the cost of capital to finance the combined projects and managerial economies. Production builders provide an excellent example of how purchasing power can afford the builder better pricing on buying in bulk.
Also by including product replacements into the home remodeling project, service cost associated with product replacements such as hourly rates, trip charges and minimum charges dissipate.
Energy Cost Savings
Major Houston remodeling projects by their nature commonly involves the removal of sheetrock, windows, old appliances and equipments. Home remodeling provides opportunities to reduce the owners energy conception in the future by introducing more energy efficient products into the rebuilding of our home.
Examples of these types of energy efficient are;
- Windows & Doors
- Air Infiltration Seals
- Insulation – Foam & Blanket Batts
- Kitchen & Laundry Appliances
- LED Lighting and the Use of Dimmers & Low Voltage
- Multi Zone – High SEER Air Conditioning Systems
- Increased Attic Ventilation During New Roofing Membranes
- Solar System
We have all heard that our home will increase in value if we make improvements. This is not always the case, but during a period of rising home values it makes it easier to recapture your home improvement investments sooner. It also depends on the types of home improvements you undertake.
Buyers react differently to the various types of home improvements commissioned relative to the age of the home. When older homes are not updated or have older home products that are near there service life expectancy, they commonly become subject to buyers discounting their market values during the sales process. They understand through the requirements of mortgage financing home compliance inspections, that there is an anticipated need for an additional future investments after the purchase of the home.
Tax Credits & Tax Savings
Although tax deductable savings and tax credits are seldom the driving motivation behind why an owner should remodel their home, they can be an attractive benefit to consider when planning a project over buying a new home. The tax laws change every tax year but we will list some of the common home improvements that are recognized as tax credit worthy; energy efficient windows and doors, wall & roof insulation and high efficient air conditioners.
There are also certain types of heat reducing roof membrane components that are also eligible for varies tax credits. In addition other home products that justify tax savings are furnaces, natural gas water heaters and certain types of back up energy systems like solar systems, geo thermo and generators.
It is important that the products you select are energy star certified to comply with the tax code. It is also note worthy that your home be evaluated for additional low cost energy savings products like deeper depth of attic insulation, exterior caulking and ceiling fans. All of which will pay for themselves in a short period of time.
Insurance disaster claims supplies homeowners with another type of opportunity to save money on home remodeling projects. This is not to say that you should wish for your home to experience a disaster, but rather if you are unfortunate enough to suffer from an insured home disaster, an opportunity exist for subsidizing a much more extensive home remodeling project at a substantially less total direct cost.
Another advantage of making the best of a bad situation is that you will likely be displaced from your home with a major home insurance claim disaster. Using this displacement time to improve a larger scope of your home lessens the likelihood of being inconvenienced in the foreseeable future by a major Houston remodeling project.
The major advantage is that your insurance claim benefit actual subsidizes your home remodeling project. This is a situation that only occurs as a result of a insurance claim event. So if you were actually considering a major home remodeling project, it is well worth evaluating the impact that one of these cost savings mechanisms may have on your planning and total home remodeling cost.