Remodeling Your Crested Butte Home

 

Are you considering remodeling your Crested Butte home?  You may be an existing owner (and future seller) who is on the fence and not sure if this is a good investment?  Or you may be a buyer who is considering buying a home you really like – but would like to remodel it.

I speak from quite a bit of experience since my wife Francene and I recently remodeled our home that was build in 2006. We touched every room in the house and added 1,100 square feet of living area (bump-out in kitchen and lower level bedroom/bathroom, laundry room, workout room).

We totally gutted the main level of the home and majority of the lower level and the master bathroom. I got a new office on the upper level of the home. We painted the entire exterior and interior of the home, 90% of the windows were replaced, we updated plumbing and electrical, we removed a vertical structural beam and replaced with a steel I-beam hidden in the ceiling, we replaced all the interior lighting, we replaced and expanded 3 decks, we added in-floor radiant heat on the lower level and in our master bathroom, a new gas fireplace, new hardwood floors, we had a refresh of all the flat screen TVs/house audio, wireless internet system… oh, and we got all new furniture.

Thanks to Gary Hartman of Sunlit Architecture, Jeff Dixon of Craft Mountain Homes, Emily Pannier of Crested Butte Design – all the subcontractors, and my wife Francene who worked together with the team on the hundreds of details.

 

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Crested Butte Mountain Modern Homes

What is Mountain Modern design? Mountain modern design is a bold, clean and intentionally less-is-more design concept. Inspired by Scandinavian Nordic minimalist style, and incorporating lighter colors, and eliminating brown as the dominant color. Sleek white quartzite island and countertops are desirable. A brighter feel incorporating larger windows, and updated lighting that brighten the home, and include indirect LED lighting. Heavy wood trim and casework around windows and doors (brown or yellowish wood color) is replaced with painted white or gray – and drywall return on the windows. Structural or cosmetic wood beam accents – and even steel beams and steel range hood provide a modern mountain feel.

Most new homes built since approximately 2015 in Crested Butte have included a “mountain modern” design. Most Crested Butte home remodels are also influenced by this design -especially a remodel of the kitchen and bathrooms.

 

 

Disclaimer – I am not an interior designer, and I do not understand women’s fashion. Interior design is very subjective – but I do see the very real trend that buyer demand is high for mountain modern finish-out. This has influenced the new spec-home construction, and recently updated homes have shown the higher price per square foot and higher purchase prices, and lower Days on Market. 

 

Let’s take a look at the different perspectives of a remodel by a Seller and a Buyer

 

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Crested Butte Homeowners / Sellers:

There is often a dilemma for Crested Butte home owners who are considering selling their home in the “near future”- “Should we remodel or not…?”

• What would we update – scope of work?
• Given the scope of work what is the estimated cost and timeframe?
• How long will we keep the home before selling?
• Will we get our money back when we go to sell?
• Will the remodel be a good investment – what could we sell the home for if it were remodeled?

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Most homeowners decide NOT to do the remodel given the estimated cost, unknown overages, and the owners time, effort, and the extended time not using the home. 

If a homeowner is ready to sell their home, and they have a dated home, then the market will reward them with an average or below average selling price. This can be frustrating for sellers who look at the Asking Prices for new spec homes, or remodeled homes in their neighborhood and see dollar signs…

The seller forgets (or choses to diminish the real cost of the remodel)

The cost of the home + the remodel cost + the overage fudge factor + the Fear and additional risk it will be more + their Buyer’s time and effort to oversee the project + the carrying cost for the time the Buyer will own the home but can’t yet enjoy it (because it is filled with workers and under construction)…

The reluctant buyer who chooses not to make an offer will usually frustrate the seller for their “lack of adventure”.

 

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Crested Butte Home Buyers:

For Crested Butte home buyers – the decision is typically evident – “We really like this home – but it needs to be remodeled…”

• What would we update – scope of work?
• Given the scope of work what is the estimated cost and timeframe?
• How long will we keep the home before selling?
• Will we get our money back when we go to sell?
• Will the remodel be a good investment – what is a reasonable purchase price of the home?

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A Buyer’s Perspective on a Crested Butte Home Remodel Starts with Fear

When a Buyer knows that there is money needed to be spent on a remodel they are fearful. They will factor in the known cost for the remodel, AND the unknown costs… And this cost is likely to be more than double the estimated cost. Plus they will add their time and effort to take on the project.  Additionally a buyer is typically new to Crested Butte and may take time to feel comfortable to put the their team together.

There is a real financial risk to a buyer and they are fearful.

The Buyer wonders what will be found when a contractor rips into a wall, or goes to do something simple like replace a window?

Simple Window Replacement – Maybe Not

It is very likely there may be some old rotten wood, and instead of a simple window replacement there will need to be a new window frame set to accept the new window. And in order to do the carpentry work to put in the new window there will need to be drywall removed. And then the drywall will need to be repaired, and re-painted. And due to the paint fading over time, the paint color touch-up won’t match exactly, so the whole room will need to be repainted…. And so on.

The buyer is not being unreasonable when they submit a “low-ball” offer to the seller – they are being realistic from their perspective.

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What is the Typical Reaction of the Seller toward the Risk-Taking Buyer?

The Seller’s Math is different. The Seller is only looking at the rest of the market and estimating their Selling Price.  Seller’s are usually “offended” by the Buyer’s offers and suggestion that the home needs work. Usually the Buyer has done the math, and the seller is not wanting to address the elephant in the room.

Most Buyers who are willing to entertain a home that is “a project” will be perceived as “sharks in the water” to the seller.

So, the Buyer may take a shot and send an offer to the Seller.

How does the Story End for the Seller of a Home in Need of Remodel?

The Seller will either win the lottery, or the market forces will convince them that they are overpriced.

It will take a while, and sometimes they will shoot the messenger (their real estate agent). Eventually they will reluctantly listen to what the market is saying and agree to price reductions until a buyer arrives who is a risk taker and submits an offer that the seller reluctantly accepts.

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The Inspection and the Objection

There will be a professional Inspection done on the home. The Inspection will reveal more surprise “issues” that were unknown to both parties at the time of the Contract.

The Buyer will go back and do The Buyer Math again (using the same formula as before). Then the Buyer will submit an Inspection Objection to the Seller demanding that the Seller remedy these surprise issues or provide a reduction in the agreed to price (or a credit at closing), else the Buyer will terminate.

Since the Seller is now privy to this new information in the Inspection Report they should negotiate with this buyer, or be required reveal this information in their Seller Property Disclosure to any future buyers. So, they can either deal with Buyer #1 now, or kick the can down the road.

The Seller calculates their carrying costs, the thought of starting over… and they come to terms with the Buyer with some concession so the deal will close and they can be done, and they can turn the page…

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The Market Will Decide

Good or bad, right or wrong — the market will decide. I spend quite a bit of time advising potential clients on the value of their homes based on the current market – the Homes Sold Homes (comps) are facts, the Asking Prices of the homes that are currently For Sale are hopes and dreams.

The unfortunate dilemma for the Seller is that if the home is in need of a significant number of repairs, but the seller “just wants to sell their Crested Butte home”.

They do not want to spend the money, time and effort to do the remodel work… and there-in lies the rub – many sellers recognize the remodel concerns, but it can be hard for them to adjust their Asking Price accordingly to account for the cost associated with a remodel to be done by the buyer. Net net plain Texas talk here – there should be a discount applied to the Asking Price of a home that the market will perceive as “outdated”.

I get the opportunity to work with both sellers and buyers – so you get the benefit of me sharing my knowledge with you(so you can make informed decisions).

It takes quite a bit of energy and commitment to take on a large home remodel project. And remodel projects make most people tired and weary just thinking about the process and timeline.

It is also human nature to be excited about a project you will be enjoying for years to come – but if you are a seller you are leaving. Adios. See Ya. Turn the Page… and so it is understandable that a seller does not want to “fix stuff”. It feels like money down the drain.

So, if a Seller is thinking that it is too much of a hassle and probably way too expensive to spend their money on their own home – what do you suppose most Buyers are thinking?

A Note to Sellers

I have watched this “Remodeling Your Crested Butte Home” story play out through the years as I have represented both Sellers and Buyers.

I realize this may not be exactly what you hoped to hear, but probably what you know deep down to be realistic.

My Recommendation for Sellers

Do what I suggest in my Book – The Complete Guide to Selling Your Mountain Dream Home: Eliminate the surprises.

1. Get what I call a “Reverse Inspection” of your home now by a professional Inspector (including Radon Test) to determine what the list of issues are…
2. Then get bids from qualified contractors to determine what the costs would be to repair your home.
3. Have an Appraisal done by a local professional Appraiser.

Get the information so you can make informed decisions.

If you choose to spend the time, effort and money, you will have a project in front of you over the next year (given the competition for contractor’s time in CB right now).

If you choose not to take on this project, I think your market price will be well below what you expect. And your home will likely sit on the market longer than you hoped.

Final Thoughts

Save yourself the anguish of not knowing. I hope you see the level of detail and time and effort I put into this candid article Remodeling Your Crested Butte Home.  I have become a Top Real Estate Agent in Crested Butte by helping my clients to make informed decisions – sometimes very tough decisions. This is representative of what you can expect from me as your agent.

If you would like to know my recommended local Inspectors, Appraisers, Contractors – Call me to discuss your specific home.

Thanks,
Chris.

 

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Chris Kopf
Global Luxury Property Specialist
Coldwell Banker Mountain Properties
Chris.Kopf@CBMP.com
(970) 209-5405