Sticking With The Old, Making It New Owners Of Older Homes Want New-home Features. They're Creating Family Rooms, Home Offices And State-of-the-art Kitchens.

Posted: January 28, 2001

You like your neighborhood, your community and the school district - but not your house.

Built in the 1950s or 1960s, it lacks the charm of an older house and the amenities of a newer one.

What do you do?

One answer is to remodel - keeping that suburban tract house, but creating spaces such as family rooms, home offices and state-of-the-art kitchens like the ones you see in new houses.

According to Larry DiCicco Jr., a Cherry Hill contractor, transforming '50s and '60s houses into more modern residences is a growing part of his eight-year-old business.

DiCicco has created something of a niche business in the Barclay Farms/Woodcrest area of Cherry Hill, where the houses are 40 or 50 years old.

It is a neighborhood prized for its "aesthetics and family oriented reputation" and for a highly regarded school district, according to DiCicco.

But some homeowners "just aren't happy with the way the houses are designed," he said. "They want space they will use and they want modern conveniences such as upgraded kitchens and the integration of natural light."

Turning dated-into-new is a trend not limited to South Jersey. In 1999, American homeowners spent $142.9 billion on remodeling - either doing the work themselves or hiring professionals to do it for them.

Homeowners are adding amenities that will provide them with housing comparable to that being built today, according to Kermit Baker, executive director of the Joint Center for Housing Studies at Harvard University.

Many homes being remodeled are the ranchers built from the 1950s to the 1980s, Baker said.

Joan McCloskey, executive building editor of Better Homes and Gardens magazine, said people who remodel their houses don't want to move.

"Remodelers love their neighborhood, their school system, their local church and grocery store," McCloskey said. "However, they also love many of the trends they see in new houses today, such as walk-in closets, high ceilings and window walls."

According to a recent survey of her readers, 47 percent of all home alterations are done to increase their value.

But 49 percent of the changes were made to add amenities that better fit the buyer's lifestyle, the survey showed.

When they see a recently renovated house, DiCicco's clients "realize that there are spaces in their own homes that aren't being used for today's style of living," he said.

So many homeowners are trying to blend the ambience of old with the comfort and style of new construction. And the effort is not limited to the suburbs.

"There are so few houses in the city with family rooms," said Christopher J. Ryan, a broker/associate with Prudential Fox & Roach in Philadelphia's Art Museum area.

"If they can, buyers are trying to add such spaces, either by building additions or reconfiguring existing floor plans," Ryan said.

Why not just buy a new house? The answer is availability and cost.

Look at U.S. home-sale figures for 1999. A record six million houses were sold, but only one-sixth were new. In the same year, new houses accounted for just 14 percent of the total sold in metropolitan Philadelphia.

Clearly, there are more older houses available than newly built ones. And new houses tend to cost more than older houses. According to the National Association of Home Builders, the average price of a new house in 1999 was $30,000 higher than that of an existing one.

Buyers of new houses tend to be older and more affluent than buyers of existing houses. Still, surveys show both groups want the same things in a house.

The younger, and typically first-time buyers, will wait to make the changes that fit their lifestyle.

"In the lower price ranges, where disposable income after settlement is often tight, projects undertaken by the new owners are restrained," Ryan said.

"These buyers have stretched themselves on down payments and closing costs, so they don't have a lot to spend," he said. "What they do is paint and generally spruce up the place, then start saving up for the more expensive things later on."

According to Harvard's Baker, about one-quarter of all spending in the first two years of homeownership is on replacements - heating and air-conditioning, roofs, windows and similar items.

Another quarter, he said, is spent on additions and interior alterations: 22.4 percent on exterior projects such as painting and landscaping, fences and walls; 12.8 percent on kitchens; and 15.7 percent on baths.

The first-timers typically set a limit of $1,500 to $3,000 for this work, he said.

While the shortage of cash denies lower-end buyers the kind of instant gratification that higher-end buyers can easily afford, waiting to undertake major projects often has its advantages.

"Sometimes you need to live in a house for a while to determine the kinds of projects to undertake to make the place yours," said Dave Welsh, a broker with D. Patrick Welsh of Swarthmore.

"Too often, with houses that have been over-improved, those unnecessary and costly changes were made before the buyer knew better," Welsh said.

The majority of higher-end buyers "immediately begin blowing out walls, doing the kitchen and additions," he said. "They'll put a family room on the first floor, since most older houses don't have one, or if there is, they'll put sliding glass doors between it and the deck."

If they don't have a deck, they'll put one in, Welsh added.

On average, these upper-end buyers spend slightly under $6,500 on such improvements in the first couple of years, Baker said.

What everyone wants is a spacious home, said Gopal Ahluwahlia, director of research at the NAHB. If they can't buy a larger house, they want to be able to change the interior of what they own so they can make the best use of the space available.

Although Americans are moving less frequently, and the wish of a majority of seniors is to be able to remain in their houses as long as possible, resale looms somewhere down the road.

And conventional wisdom is not to overimprove.

Each year, Remodeling magazine and the National Association of Realtors combine to produce a "Cost vs. Value Report."

The 2000-2001 report lists a series of popular remodeling projects, their cost, and how much of that cost a homeowner can recoup if the house were sold within a year.

Surprisingly, the best thing a Philadelphia-area homeowner can do is paint the exterior of the house. At sale time, 91 percent of the cost - $9,185 - can be recouped.

In addition, the NAR says that almost half of home sales are based on curb appeal - a buyer's first impression when he or she sees the house from the street - so spending the money is a good idea.

About 86 percent of minor kitchen remodeling - which costs slightly more than $16,000 here - can be recovered at sale time. That includes refinished cabinets, new resilient flooring, oven, cooktop and sink and repainting. For a typical $73,000 two-story addition, 81 percent will be recovered at resale, while adding a bathroom costs about $16,000, with 82 percent recoverable.

But only 67 percent of the $52,606 typical cost of a family-room addition is likely to recovered at resale time, according to the report.

NAHB research shows that Philadelphia-area buyers prefer traditional living rooms to family rooms in new and old houses. That bucks the national trend, Ahluwahlia said.

But DiCicco follows the trend.

One of his projects last year was remodeling his own house in Barclay Farms. He turned the old formal living room into what he describes as "an extremely comfortable family room, complete with a built-in entertainment unit and wood-paneled walls."

Alan J. Heavens' e-mail address is aheavens@phillynews.com

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