Investing in California Real Estate

[ballzo]

My wife and are seriously considering investing about 20K to 25K in a backyard remodel for our place in Sacramento. We would like to stay in the home at least another 4 to 5 years. We have a new baby in the house and need a safe place for her to play. With the California economy. I'm wondering, is it a bad time to invest in California real estate at all? I'm just a bit afraid that we may be throwing 25K into house in a state that nobody will want to live in because of the California state finances being so dismal. What are your thoughts?

[tripods68]

I think its "fools gold" to put $25K on remodeling when you plan is to move 4 or 5 years from now. You can't even break even.

[reptile411]

What kind of backyard remodel are you doing? Building a 2nd house? I own a landscape company about an hour south of Sacramento and see amazing stuff done to a yard for children for less than half of that. I also agree with the other poster. To much to invest as you will NOT get it back in 4-5 years. I doubt we will see another housing explosion for a very very long time.

[wincrasher]

Do a backyard remodel if it is useful to you/adds to your enjoyment.

It is NOT an investment.

Some people see alot of elaborate landscaping as a maintenance burden and some see it as a must have. Kinda like a swimming pool is some regions.

If I were you, I'd try doing alot of the work myself and keep the expenditure to a minimum.

You didn't describe what you had in mind though. Decks, outdoor kitchen and fencing might have a decent return. You can blow thru alot of money on sod and elaborate plantings, water features, etc.

[DebbieL]

I think you have gotten some great advice so far. I really don't think it is necessary to spend $25k on the back yard so it is a "safe" place for your baby, unless you are currently living on top of a toxic dump or something, lol. She will be fine with a little swing set and a sand box Have fun with it!

[disneysteve]

My wife and are seriously considering investing about 20K to 25K in a backyard remodel for our place in Sacramento. We would like to stay in the home at least another 4 to 5 years. We have a new baby in the house and need a safe place for her to play.

Unless there were serious issues, I wouldn't spend 25K on a house I wasn't planning on staying in for a long time. I certainly wouldn't put out that kind of money for anything not mandatory (structural stuff or electrical or plumbing problems for example).

What exactly are you looking to do? A safe place to play is grass and a fence. Can't imagine that will cost much.

[tmvijai]

Thats a lot of money to throw for remodeling without know what you exactly want to do. ROI on remodeling varies a lot according to the modification made. If you adding a patio, it adds value depending on the state and area. So it all matters. As others said, I wouldn't spend too much in to remodeling at this credit crunch period.

[disneysteve]

No matter what you decide to do, stop using the word "investment" in this discussion. Remodeling is NOT an investment. Personally, I don't think your home is an investment at all. You will virtually never get back what you spent on a remodel when you sell the home. You might get back 70 or 80% so it is definitely an expense, not an investment.

[wincrasher]

Depending on your neighborhood, remodeling may make the difference between selling your house at all or not.

My old house didn't have central air conditioning - in South Carolina! I spent the money to put it in - about $6500. Think I will get that all back - makes the house go from unsellable to sellable.

I spent $25k on a kitchen remodel (materials only - I did the work). Way too nice for my neighborhood, but when I did it, I was doing it for my own pleasure. Don't think I'll get alot back on that one.

Bathrooms I remodeled, I will get back all the money. They were very antiquated and there was some flooring decay.

Everyone keeps talking like the real estate market has changed somehow. It has not. You have to buy right and upgrade right to make money. You can't just go in, pay full price, throw a bunch of money at upgrades and make alot of money. It's never worked that way and never will. You have to find a bargain, put in sweat equity and wait for your selling oppportunity to the right buyer. Just like any "investment" you can't put it on automatic and expect results.