The Levines were planning to renovate their home for years, but, Mrs. Levine said “Would we have taken on the project to add a deck if one of us lost our job during the economic downturn? Obviously not.” Still, this is only one construction site out of many that could be found on the block of 136th Street and 71st Road in Queens this summer. Not all of the families who began to renovate their homes during the recession fared so well.
The Levines are enjoying the expansion of their town house which has been their home for the past 45 years. This project was in their horizon for a long while, but it was the dining room window that needed to be fixed that put a move on things. So they spoke to their contractor about replacing the window, and he replied: “Why not expand now?” So they did, and ever since, they have been taking pleasure in their new rear deck. When asked if this project affected their future plans or vacations from a financial perspective, they simply said “No.”
The “Great Recession” settled on America over a year ago, and people are still searching for signs of relief. While some are comforted by what experts call signs of recovery, the newest unemployment rate shows a staggering 10.2%, with over 500,000 people laid off during the month of October alone. Americans are waiting for the blanket of financial security to tuck them in again and they are internalizing every new financial report. Many people, however, have found that one sure sign of foreseeing the recovery of the economy is a rise in construction. With countless parking garages throughout the city being torn down and replaced with monumental high rises by construction workers, who are getting paid, there must be some money in our seemingly wilting economy.
The big business conglomerate is joined by the people who are clamoring to get things done, looking for opportunities that are only open in the harsh current economic environment. They are scoping out homes that can be bought with lower interest rates on borrowed funds, watching out for wise investments in the foreclosure market, or at the least improving their lives with whatever means possible. For many people that translates into renovations and expansions in the homes that they lived in for years. And even this needs to be planned and carried out carefully.
Financing these operations is undoubtedly costly – only the fee to obtain a permit granting permission to start building costs $3,000. The Abdrakhmanov family spent over $20,000 dollars renovating their basement this past summer. Considering the fact that it took the family six years to commit to a renovation of such magnitude, it would seem that their timing in light of the current economy couldn’t be much worse. However, when the father of the house was posed with the question, his reply was simply as follows – “It is an investment in what I already own, and if I decide to sell this house, there will be a higher selling price to show for it.”
Not everyone fared as well in their home improvement endeavors. The Moskowitz’s began a major renovation on their home over a year ago. The semi-attached house was remodeled to include a third floor, the back was extended the full seven feet allowed by zoning regulations, and new windows and doors were installed throughout. The project, however, was never completely finished. When contacted, the husband and wife declined to comment.
There is only one conclusion that all these examples point to: the economy can only be considered recovered after it is healthy. However, since no financial system is fool proof, sound, and safe, Americans must be prudent, mindful, and strong when taking risks.