Renovate Now? In This Rotten Economy?

By: Myryah Irby , Contributing Writer
In: Home Improvement Tips, In The News

It may be a lousy time to try to sell your home, but if you’ve postponed a necessary renovation, say repairing a leaky roof or updating an old bathroom,  now just might be the ideal time to get started, no matter if you decide to hire out or do it yourself.

Of course there are stipulations, such as: If you’re hoping to tackle these renovations with the help of a loan, you should:

  • Have at least 20% equity in your house
  • Have proof of income, and
  • have a good credit rating

Sure getting a home equity loan is harder these days, but it’s not impossible. Greg McBride, the senior financial analyst at, argues that if the conditions are right (e.g. what I’ve listed above) banks will be happy to loan you some cash: “They need to offset all of those bad loans with quality ones.”

OK, another stipulation: Hopefully you didn’t buy at the tip of the peak in an area where prices doubled or tripled. That may make getting a loan tricky to impossible, but let’s assume that you didn’t do that, and move on to a list of reasons why this is a buyer’s market for home improvers.

Contractors are Taking on Less Expensive Projects

Many contractors now need smaller jobs to keep their crews busy and their business afloat. They are also more open to discounting their services. Some skilled trades like plumbers, electricians etc. may not have dropped prices much, but other trades such as finish carpenters, painters, and tile setters are more competitive now.

Many Supplies are Cheaper

Especially helpful for DIYers. With the dwindling demand, many construction materials have come down in price. According to Forbes, steel, aluminum and copper are dropping in price. Steel is down 9% and copper (commonly used for wiring and plumbing) is down 11% from a year ago.

Lumber has also dropped in price, though not as drastically. Lumber, sold per 1,000 board feet, sells at around $207 right now but some predict it to drop as low as $172 in the near future. And Places like Lowes and Home Depot are becoming more aggressive in their discounts. Home Depot’s Website they boldly proclaims “NOBODY BEATS OUR PRICES, If any competitor tries, we’ll beat their price by 10%. Guaranteed.”

Take Your Countertop for Granite

If you like granite, and many people do (I’m not a fan but that’s neither here nor there) now is a good time to do a little countertop remodeling. Granite’s durable and long lasting, and popular! For this reason, and because it’s so easy to manufacture, the market is pretty well saturated so prices have come down, some contractors say the price has decreased 25% over the past year.

You’re Stickin’ Around
Given the real estate market, you’re probably not planning to sell for a few years. And that means you can really kick back and enjoy the improvements you make instead of focusing on them as investments.

The Harvard Joint Center for Housing Studies has predicted that by the end of 2009 home remodeling will be down 12 % from 2008. But you can buck this trend armed with the knowledge that the Fed will most likely (oh who knows?) continue to cut home equity interest rates. So if you’re in a position to remodel and are so inclined, there are plenty of reasons to seize the day.


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  1. 3 Responses  to “Renovate Now? In This Rotten Economy?”

  2. Aug 29, 2011
    Thanks for the useful tips and guidelines. really had a great time reading your blog. Thanks for sharing!
  3. Aug 29, 2011
    Good advice here. As you said, home equity loans are getting tougher to get. In fact, some banks are arbitrarily reducing the limits on and even freezing any new debits from existing home equity loans because they're afraid customers may try to live off them. If you're planning on any major home improvement projects this year, be very careful about paying credit card, utility and even tax bills on time. A friend of mine lost her $150,000 home improvement line of credit because she was late with a couple of credit card payments.
  4. Aug 29, 2011
    I'm in residential home remodeling and can say we're certainly starting to see some stronger activity again. It certainly *has* been helpful to have the lumber and metal prices come down. Ditto for fuel prices: many of us are able to offer better prices because of it. With regards to granite, I'd like to add that I haven't really seen a price drop in the better quality stone. What I'm seeing is some very poor quality stone flooding the market -- pitted and warped slabs, large fissures and cracks, varying slab thicknesses which can be almost impossible to seam properly -- which might account for the perception that stone is "dropping" in price. It probably varies around the country. The best advice I can offer is to buy the best you can afford, and research (and research some more!) before buying.