How much does a shop build add to property value?

[Bryan Hall]

The youtube woodworkers have stories and insight on all of this as well. Mark Spagnolo documented moving to Missouri and discussed the problems along the way. William Douglas was actually forced to move out of his own home because of his noise pollution (if you are sanding and milling in your backyard in open air, you're asking for a noise complaint).

[Jim Becker]

Zoning/Planning in residential zones often permits home businesses, but that usually comes with a prohibition of public traffic (including having employees) and other disruptive activities. The cannot totally forbid it without a major revolt because there are many folks who work from home, have online businesses. In the context of woodworking, assuming there is reasonable attention to noise, etc., a single person shop doing commission work that never or rarely has a visitor would likely not have an issue in most jurisdictions. We've actually had this conversation in the Planning Commission I'm a member of (and may get stuck running this coming year) as well as in the Planning course I recently completed.

That said, the permitted use is not as material to whether or not a "shop building" will provide any additional property value to average buyers. I know when we were shopping for a new property, those that actually had buildings that could be used for that purpose often didn't really call out that use...it's was pretty much, "oh, it has an outbuilding" and was never referred to as a "shop" or anything other than maybe an additional garage for parking.

[Curt Harms]

Lots of people run commercial shops on their properties, so I know it can be done. I'm always a little curious how they do it on the legal side.. I always assumed they were keeping it on the down low with the assumption that the city / town / unincorporated area, etc doesn't really care. Especially in farm country.

I think most municipalities don't really care unless there are significant tax dollars to be had. If a neighbor bitc...er complains they have to do something if it violates zoning.

[Don Corbeil]

When my wife and I built our house and shop in Louisiana, we also considered how it would impact the property value. Both Gatte Construction, our home builder, and our realtor told us that adding a shop could increase the property value by approximately 80% of its build cost.

[Jim Becker]

It might...over time...but there is emphasis on the word "time" in that. Geography also matters. Outbuildings have more or less desirability in various areas because of a variety of factors. I can assure you that if I had to sell our property "tomorrow", there's no way I'd get anywhere close to 80% of the $50K I put into the shop building a year ago. In ten years, I likely would.

[Justin Rapp]

It might...over time...but there is emphasis on the word "time" in that. Geography also matters. Outbuildings have more or less desirability in various areas because of a variety of factors. I can assure you that if I had to sell our property "tomorrow", there's no way I'd get anywhere close to 80% of the $50K I put into the shop building a year ago. In ten years, I likely would.

Ok - sell me your house so I can have your shop I suspect it's got a lot more room than my basement shop!

[Andrew Seemann]

A lot will depend on where you live. I'm at the very edge of suburbia. Around here, once you get out of the housing developments, it seems like you are nobody without at least an outbuilding or two. I figure mine added at least the cost of materials that went into it. Not sure that I would have recovered the cost if I had to pay someone to build it though. Where I was in the city, I didn't recoup the cost of my old shop, a carriage house style building. Having to sell at the bottom of the market in 2011 didn't help.

[Jim Becker]

Ok - sell me your house so I can have your shop I suspect it's got a lot more room than my basement shop!

ROFLOL!!! There's a lot available next door if you want to be my neighbor...

[Alan Lightstone]

Really wondering what mine will add to the property value. I live in an interesting house. The workshop we built is on the ground floor - 2400 sq ft. Climate controlled with plumbing. Could be used as an extra livable floor in the house.

Good old Zillow says that properties in my neighborhood go for $385/sq ft (which seems so insane. We sold our last house, which was larger and gorgeous for about $210/sq ft). Using their math, it should raise the house value by $462K, which is, of course, seems ridiculous.

So I wonder what does building out an area of your existing house that was a garage and turning it into livable space do to your house value.

[Jim Becker]

If it's "just a room", not as much as a nice en-suite would, even thought they are both "living space". But there are still many variables. I don't recall if an attached garage is calculated into the living space or not, but if not, increasing the living space might have some level of immediate uplift in resale value. Whether it covers the expense of conversion or not is a moving target.

[Justin Rapp]

ROFLOL!!! There's a lot available next door if you want to be my neighbor...

Good idea - except my wife might get a little annoyed at a much longer commute to her job

[Jim Becker]

Good idea - except my wife might get a little annoyed at a much longer commute to her job

She's also be annoyed at the cost...it's kinda a sad situation because the folks who bought the property (a local neighbor) did so to rehab the home that was on the land and resell it. Unfortunately, they did not look carefully enough at the condition of the home. (really sad because the guy is an experienced builder but let his desire to help the neighborhood cloud his eyesight) Since it was an "as is" sale, they were then stuck with a building that couldn't be salvaged due to excessive water damage, mold and some significant structural issues. Oh, and a layer of asbestos in the paster. They bought for a low price, but the cost to remediate the asbestos (even doing the labor themselves) was "yuge" and the cost to demolish the structure, haul off the 'stuff' and then regrade the property to presentable was considerable. I helped with the land work and with a little of the pre-demolition. I don't believe anyone would just come off the street and buy the lot for what they have to ask for it to break even, so it will have to be a "build to suit" to ultimately sell it. The guy, while being a great builder, has some major health issues so that's not going to happen anytime soon. Meanwhile...I have a lovely .375 acre lawn next door to my own half acre that I mow and keep in a park-like condition.

[Alan Lightstone]

Mine is "just" two rooms. But, at least down here, garages don't factor in to "conditioned space", and thus the sq footage that a house is listed at. So in theory, I think, my house grew by 2400 sq ft. In reality, way down the line when we're gone and the kids have to sell the house, who knows.

[Mark Wedel]

At least where I live, the houses are required to have 2 covered parking spots, which in most cases is covered by the garage (no requirement that people park their cars in the garage, just that the space exists). But this means that it normally isn't possible to convert the garage into living space, so garage space is not included in living space for that reason. There are different ways to convert garage into living space (make a carport, or build another garage). And one could do it illegally (without permits), but since most garages are at the front of the property near the street, a bit harder to pull that off.

[Michael Burnside]

The land will likely be worth more. I bought 2 acres 4 years ago (just before covid) to build a house and detached shop. The shop didn't add much to the appraisal, similar to Alan's comment, but around me to buy 2 acres now will cost you the same as building 5 shops LOL.