3 Reasons For Building A Garage

[bryan whitley]

Hey guys,

For anyone who's on the fence about building a garage, I wrote an article giving you some good excuses for why you should start working on it. Check it out and let me know what you think.

[Mitchell Andrus]

Bryan, welcome to the Creek.

I know Go Articles isn't The Harvard Law Review, but when I read an article like this, I wonder about the underlying data.


How much more do garage kept cars really sell for? Not enough to come close to paying for a garage, I'm sure.

Spending money on a garage may over-improve a home in some areas and increase it's value very little - less than the cost of the garage itself.

According to:

http://www.demesne.info/Improve-Your...vement-ROI.htm

(in conjunction with Remodeling Magazine and Realtor Magazine),
Top Ten Best Midrange Projects

Project

Job Cost

Resale Value

Average
ROI

Wood deck addition

$10,347

$8,835

85.4%

Siding replacement

$9,910

$8,245

83.2%

Minor Kitchen Remodel

$21,185

$17,576

83%

Window Replacement (wood slightly higher)

$10,750

$8,750

80% avg

Bathroom Remodel

$15,789

$12,366

78.3%

Major Kitchen Remodel

$55,503

$43,363

78.1%

Attic Bedroom Remodel

$46,691

$35,771

76.6%

Basement Remodel

$59,435

$44,661

75.1%

Two-Story Addition

$139,297

$103,010

73.9%

Garage addition

$53,897

$37,467

69.5%

http://homerenorepair.suite101.com/a..._on_investment

...pegs the garage ROI at 64.6%


Storage... can't fault that one.

I would include a paragraph on owner satisfaction. Even if all or most of the money doesn't come back, there is value in bringing your home up to current standards and the utility of the final outcome. A patio to surround the grill may not get your home sold faster, but it beats standing on dirt.
.

[Matt Kestenbaum]

I'd say the numbers are very optimistic...and likely based on pre-crash rising values.

Both the Wall Street Journal and the New York Times ran front page stories today about the declines in home sales and the resulting value slump. I know that in my neck of the woods (halfway between NY and Philly...values are still 25-30% below 2005-2007 levels...and possibly still declining. Building or remodeling just about anything on an existing home, including a garage has an ROI of 0. Nada. Buptkes. Because as fast as you pour money into your home...the market around you is declining. You now have a house losing value with a new garage. As long as the model of real estate as investment is inverted, we will all be lucky to reap the tax benefits of having a mortgage, get our principle paid back in our old age and have a warm/cool/safe place to sleep. And work wood.

It reminds me of a quote once from Robert Parker...the wine guru. Amid a rare wine auction, he was asked if it was really possible that a bottle of wine could possibly be worth $XXXXX...he said, "not if you open it."

[David Helm]

My problem with all this ROI stuff and building on to your home for sale is that it puts the emphasis on the wrong things. The main reason, in my (not so) humble opinion is improving ones quality of life. If, at a later date, you make some money on the improvement, it's a bonus. If you are doing improvements just for ROI you are wasting money. Do improvements that improve your enjoyment of your property. The money return may or may not come later.

[Matt Ellis]

My problem with all this ROI stuff and building on to your home for sale is that it puts the emphasis on the wrong things. The main reason, in my (not so) humble opinion is improving ones quality of life. If, at a later date, you make some money on the improvement, it's a bonus. If you are doing improvements just for ROI you are wasting money. Do improvements that improve your enjoyment of your property. The money return may or may not come later.

I agree with this. Clark Howard always says "you have to live somewhere". might as well make it nice/enjoy it.

-matt

[Matt Kestenbaum]

David I generally agree with you -- those that only understand their homes strictly as a financial asset are taking the "home" out of home ownership. That said, for the last 60 years or so American's have been able to combine the creature comfort and enjoyment of a home with the financial principle of long term saving. These are great things to combine...it promoted a lot of social good in addition to asset growth...pride of ownership, community stability, etc.

But, that said it is still the biggest and most important purchase most people ever make. Making changes to it and spending money on it for the creature comfort of it are great as long as that's the understanding. In this time of falling values though I see a lot of owners who have tiled, kitchen-cabineted and lanscaped themselves into losing propositions.