Remodeling now more practical and profitable

For Kitchens by Diane business owner Diane Feuillerat, timing is everything. Having worked for two remodeling and construction companies, and having built a 400-strong client base, she was quite hopeful that her business would experience a bountiful first year. And as fate would have it, her company has worked on two to three times the forecasted deals in spite of the looming negative trends in the housing industry. For the year 2010, there will be more remodeling projects than construction of new homes for the first time ever in 26 years.

This year will be one of the worst periods ever for the real estate industry, whose local sales have been falling for three years in a row pulling down average sale prices as well to 2001 price ranges. Since 2004, construction of new homes has dwindled each year when Boone and Winnebago county builders handled permits for 1,865 new houses. The time period from January to October this year has only seen 169 building permits for new houses, which is a negative turning point in the real estate industry.

Now, more homeowners choose to remodel their house instead of investing on building a new house. Rock River Valley residents have invested as much as US$27 million in remodeling permits alone for the month of October this year, followed shortly by US$21.3 million 6 years ago. Fueillerat knows that her customers are aware of how hard it is to sell their house under current real estate market conditions. That is one of the main reasons why her clients need to remodel their houses where they’ll be staying for at least the next five or so years.