Drive around some of the close in Washington DC metro areas like Chevy Chase, Bethesda, and Arlington and you will still find large numbers of homes being remodeled or totally renovated. Didn't anyone bother to tell these people that the housing market is over priced by 25 percent? Apparently not. So what's behind all this activity.
The local Washington DC housing market is overpriced by 25% according to a recent study reported by WTOP Radio. While this is probably true, some neighborhoods are going to get hit harder than others. I think that buying homes and remodeling them in neighborhoods that are closer to Washington DC and Metro Stations still makes sense and in the long run will be worth it.
Despite the study, a better indicator is what people are actually doing with their money. We think that people who are remodeling now are doing it for a number of reasons:
- They think that rising gasoline prices are going to be with us long term,
- It's too expensive to travel so we're going to live in style at home,
- Their homes are reaching the end of their useful life and need to be brought up to current standards,
- Contractors and architects may be more reasonable and easier to work with, and
- Homes in and near metropolitan areas or Metro will retain their values better than homes far away,
- They bought their homes years ago and there's still a lot of equity despite recent price declines.
We know that the newspapers and TV talking heads and of course economists are spouting gloom and doom about housing and home remodeling. However, there are too many construction dumpsters around to justify the latter across the entire Washington DC area. Some neighborhoods are going to hold up better than others as they have in past housing downturns. The willingness of people to remodel in these neighborhoods may be an indication of those neighborhoods resiliency to the predicted 25 percent decline.
We suspect that home remodeling in some New York, Chicago, San Francisco and Los Angeles neighborhoods is also stronger than expected. That's because people are responding to higher gasoline prices by refocusing on their homes. In other words, they think "if we can't afford that trip to the beach or mountains, then lets create some of those amenities in la casa." With the above in mind, home owners are updating and creating more sophisticated indoor and outdoor places.
Less is More
Notice that we didn't say "large" indoor and outdoor spaces. People who have decided to remodel their homes are not totally ignoring the economy or the local housing markets. They feel a need to get things done, but don't want to overdo home remodeling either.
Home remodellers are also concerned about the future costs to heat and cool a home. These constraints are redefining the boundaries of new home remodeling. Good architects and interior designers are assisting home remodellers with these issues. They are focusing on improving the home's flow without going beyond the footprint.
We think that homes will incorporate solar and wind energy in them. That includes multiple family home owners too. This is especially true if Congress extends and provides greater tax credits and incentives for solar and wind energy projects.
Good architects and design build firms are helping homeowners to
If you are a Realtor, Architect, or someone who decided to remodel, please share your thoughts with us and comment below.