Home improvement is the addition, alteration, conversion, rehabilitation or remodelling of a building or structure and/or its appurtenances. It may include a swimming pool, patios, landscaping, fences and gates or other structures on the land. It may also refer to the repair, restoration or improvement of existing buildings and their appurtenances or to any other work on a building, such as electrical or plumbing repairs.
Home improvements are generally designed to make a house more functional and appealing to its inhabitants, but sometimes they can be done just to add a touch of luxury or style. Some of these projects are less likely to improve resale value, but they can be a good way to increase personal enjoyment of a property, such as adding a kitchen island or a master suite. Others are more practical, such as a new garage door or increased insulation to reduce energy costs.
A number of financial institutions offer mortgages and loans specifically for home improvement, including Fannie Mae and the Federal Housing Administration. In addition, credit cards offering home improvement rewards can be a convenient option for paying for renovations.
While a well-planned, carefully executed home improvement project can increase a property’s value, an overzealous homeowner can run into trouble. For example, a homeowner can overspend on materials and then encounter problems with the construction that require additional money to resolve. Such problems can be costly, and in the worst case scenario, can result in the homeowner being unable to complete the home improvement project and defaulting on the loan.
The cost of home improvement projects can vary greatly, depending on the type of work performed, the materials used and the level of expertise required. To avoid these problems, homeowners should obtain multiple estimates and consult with real estate professionals to determine the best upgrades for their specific situation. It is also a good idea to discuss any potential problem areas with a professional before starting the project, to minimize unpleasant surprises and potentially expensive complications down the road.
Many homeowners use equity in their homes as the primary source of funds for home improvement projects. The most common approach is a home equity line of credit (HELOC), which allows the homeowner to draw on a portion of the equity in their home and repay the debt over a period of time.
Another popular method of financing home improvement projects is to utilize the equity in a second mortgage. This type of loan is secured by the borrower’s first mortgage and typically has lower interest rates than unsecured loans.
A licensed contractor should be able to provide you with a contract for home improvement that includes the estimated price of the work, the name and address of the company, a description of the work to be performed, the date on which it will begin and when it will be substantially completed. Maryland’s Home Improvement Law requires that all contracts be written and signed before any work begins.