Zillow real estate investment writer and long-term investor Leonard Baron, MBA, is answering questions from MintLife readers.
If you have a question about investment properties, cash flows, insurance, mortgage financing, homeowners associations, renting versus owning, foreclosures and more, drop Leonard an email.
Mari of Reading, PA asks:
I own a small house and want to make a large addition to the property. Can you provide some basic guidance for this?
Answer: When considering a home addition, here are four important items to consider:
What can you build?
First, you need to figure out what you can build.
Based on the current zoning of your particular lot, there are likely building limits that apply to your property.
There may be a maximum amount of square footage you can build and a maximum height.
There may also be setbacks – the distance your home must be from the street – or parking requirements to ensure there is ample space for cars on your lot.
What is the process?
You will need to consult a local land-use consultant and/or architect to walk you through the city and county building rules.
You may also need approval from a local planning group and/or the city council depending on the rules and regulations of your city.
How much does it cost?
Costs for additional square footage vary depending on location – Pennsylvania is less expensive than California, for example – as well as the type and nature of the improvements.
Are you adding just a bedroom or are you updating a kitchen, which may require changes to the plumbing, etc.?
Other things that can be costly include changing the slope of the lot, the number of floors or the building materials used.
An architect and contractor can help you estimate the cost of your addition taking these factors into consideration.
One thing to note, it will likely cost more than you think so plan some significant contingency funds.
It’s usually less expensive to buy something already built over building it yourself, so you might also want to consider selling your property and buying a different one that meets your needs.
How do you select an architect and contractor?
Start by getting multiple bids, calling references and looking at past jobs they’ve done in person.
To the best of your ability, detail the work needed in writing, try to avoid change orders, check insurance and bonding, and make sure you understand state licensure requirements.
Lastly, before you begin, try to find a trusted friend who has done similar renovations, so they can hold your hand throughout the process.
Leonard Baron, MBA, CPA, is Zillow’s real estate investment writer, a San Diego University lecturer and real estate due diligence expert. As America’s Real Estate Professor®, his unbiased, neutral and inexpensive “Real Estate Ownership, Investment and Due Diligence 101” textbook teaches real estate owners how to make smart and safe purchase decisions.
Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.