M2 | Friday, June 19, 2020 THEWALL STREET JOURNAL.

COUNTING HOUSE | BETH DECARBO

Itching to Renovate? Expect DelaysLengthy lockdowns helped some homeowners identify design flaws, but fixing them could take longer and cost more money

MANSION

USING YOUR EQUITY TOREFEATHER YOUR NESTWith interest rates still rela-tively low, tapping home equityfor renovations is attractiveright now, says Guy Cecala,publisher of Inside MortgageFinance.One financing option is a

home-equity loan, a type ofsecond mortgage that providesa lump-sum payout, with boththe interest rate and monthlypayments fixed. Another routeis a home-equity line of credit,which lets homeowners borrowjust the amount needed, withinterest charged only on theamount drawn.As of June 15, the average

rate for a home-equity loan fora five-year term was 5.22%, ac-cording to Bankrate.com. Ratesfor a home-equity line of creditaveraged 4.94%. (Rates assumethat a borrower seeking$100,000 has a credit score of700 and a combined loan-to-value ratio of 80%.)Lending terms vary widely

on loans and lines of credit, sobe sure to ask about closingcosts, fixed versus variablerates, and monthly payments.Also consider the risks: Falloutfrom the pandemic, such as ajob loss or falling home values,could affect your ability to re-pay borrowed funds.

—Beth DeCarbo

pick tend to come from othercountries,” Mr. Cohen says. Shut-downs—even in countries whererestrictions have been lifted—have created lag time.

Finally, some clients just aren’tready to take any risks. “The nextpiece is asking homeowners, ‘Doyou want strangers working inyour house?’ ” Mr. Cohen says.“They may not want anybodycoming into their ecosystem.

“It’s a scheduling nightmare.The nice thing is that everybodyunderstands.” FR

OM

TOP:

HARR

ISONDES

IGN(REN

DER

ING);JIM

FOST

ER/POINTK

NOWN

Hammer TimeHereare themetroareas inwhichthehighest shareof home-equityloansaredesignated for homeimprovementsMETROAREA %USEDFORRENOSMilwaukee 66.7%Louisville, Ky. 60%Columbus,Ohio 56.6%VirginiaBeach,Va. 55.3%Indianapolis 54.9%U.S.Average 45.9%

Source:LendingTreeanalysisof loanapplicationssubmittedbetweenJan. 1andApril30

That open floorplan homeownersonce considered soessential nowseems so impracti-cal in a pandemic.Try getting any

work done while a Zoom-castZumba class blares in the back-ground.

“I think people with childrenrealize they don’t have well laid-out homes with separate spaces,”says Jesse Harrison, a Los Ange-les-based principal of HarrisonDesign, an architectural and inte-rior design firm. “For clients withtwo working adults and childrentrying to do schoolwork, you needthree or four distinct spaces.”

With social restrictions loos-ened, some homeowners are readyto undertake a remodeling proj-ect. There are some benefits rightnow in terms of financing andproject planning. But a big renohas its risks, too. Here are somethings to consider before rippinginto the drywall.

Efficiencies in project planningIn Hingham, Mass., technologycame to the rescue of a youngfamily planning a renovation. Ar-chitect John Day and his teamneeded to go inside the home totake photos and measurements.But the couple was reluctant toallow access for fear of exposingtheir three children to the corona-virus. So Mr. Day used a companycalled Pointknown to provide both3-D images and room measure-ments using a laser scannermounted on a tripod. The processrequired only one technician, whowore protective gear. It went sosmoothly that the firm plans touse it for other projects.

The Boston-based firm, LDa Ar-chitecture and Interiors, has got-ten more calls since the viral out-break, Mr. Day says, mainly from

A technician from Pointknown uses a portable scanner to photograph andmeasure the exterior of a home.

Harrison says.However, both agreed that

price cuts may only be temporary,especially if the economy re-bounds.

The downsides of a remodelIn New York, Owen Ryan was inthe middle of gut-renovating hisManhattan apartment when theshutdowns were announced. Nowhe worries that the economic tollon the construction industry willmake it harder to find qualifiedlabor to finish the job. “Every-one’s worried about their contrac-tors. Will they be able to stay inbusiness or pay their employees?”says Mr. Ryan, chief executive ofGeller Advisors, a family office.

Boston builder David Cohensays clients need to understandthat new construction-site safetyprotocols will affect project time-lines.

Construction projects will takemuch longer because of limits andsocial distancing imposed on sub-contractors, such as plumbers,electricians and heating/air condi-tioning installers. “It annihilatesprojects,” says Mr. Cohen, owner ofHampden Design and Construction.

Some municipalities may beslow to resume permit reviewsand on-site inspections. Mr. Harri-son says some paper plans sub-mitted to L.A.’s Department andBuilding Safety were “quaran-tined” for several days before re-view by city staffers. (The depart-ment declined to comment.)

Availability of materials mayalso cause delays. “The next battlewe face in high-end homes is thefinishes—tiles, light fixtures, wall-papers. All the materials people

existing clients who want totackle the next phase of a renova-tion project. “We’re expecting tosee more interest in home officesand flex spaces for learning withkids,” he adds.

In Los Angeles, Mr. Harrisonsays Zoom video calls have re-placed the marathon face-to-facemeetings. Now, clients can getplans emailed and product sam-ples shipped directly to theirhomes. “We can pull up a screento show drawings and inspirationoptions,” he says. “It’s surpris-ingly effective.”

Some municipalities haveadapted as well. In Boston, likemany cities, almost all construc-tion projects were temporarilyshut down until safety protocolscould be put in place. But amidthe moratorium, the Departmentof Inspectional Services continued

to accept building-permit applica-tions, design plans and other doc-uments through its online portal,says the department’s commis-sioner, Dion Irish. Staff within thedepartment could review plansfrom home and communicate di-rectly with project managers, if

necessary. In May, the site en-abled users to make electroniccheck payments in addition toother forms of payment.

Since the new procedures wereput in place, the department hasbeen able to review plans at afaster pace. “Some of the changeswe’ve adopted will probably stayin place” after a return to nor-malcy, Commissioner Irish says.

Discounts on labor and materialsEager to return to work, somecontractors and subcontractors,such as electricians, plumbers andmasons, have been willing to re-duce prices, Mr. Day says. “Build-ers are repricing or rebiddingprojects since the outbreak andwe’re seeing some ‘value pricing’now. There’s a lot of positivethere,” he says.

Likewise in L.A. “For a smallercontractor to land a job duringuncertain times, it’s guaranteedincome. So they’re willing to offera substantial reduction in fees tokeep their crews working,” Mr.

Architect John Dayused a laser scanner at ahouse last month togather measurements.

A Los Angeles couple is planning a $2 million renovation to expand their home in the Pacific Palisades. HarrisonDesign, an architectural, landscape and interior design firm, created renderings for Zoom video calls with the clients.

DWELL IN THE POSSIBILITIESOF A LIFESTYLE LIMITED ONLY BY YOUR IMAGINATION.

NEW Luxury Residences in Palm Beach Starting at $1.85M

MOVE-IN READY

A NEW take on modern luxury: 30 oceanfront residences

A NEW definition of secure: Private entry and semi-private lobbies

A NEW level of indulgence: 24-7 concierge team catering to your every need

3 5 5 0 S O U T H O C E A N . C OM

Exclusive Sales & Marketing byDouglas Elliman Development Marketing

3 5 5 0 S O U T H O C E A N . C OM

Exclusive Sales & Marketing by Douglas Elliman Development Marketing

THE COMPLETE OFFERING TERMS ARE IN A CPS-12 APPLICATIONAVAILABLE FROM THE OFFEROR. FILE NO. CP17-0062. ORALREPRESENTATIONS CANNOT BE RELIED UPON AS CORRECTLY

STATING REPRESENTATIONS OF THE DEVELOPER. FOR CORRECTREPRESENTATIONS, MAKE REFERENCE TO THIS BROCHURE AND TO THEDOCUMENTS REQUIRED BY SECTION 718.503, FLORIDA STATUTES,TO BE FURNISHED BY A DEVELOPER TO A BUYER OR LESSEE.WARNING: THE CALIFORNIA DEPARTMENT OF REALESTATE HAS NOT INSPECTED, EXAMINED, ORQUALIFIED THIS OFFERING.

3550 South Ocean Boulevard, Palm Beach FL 33480

Call to Schedule Your Private Tour: 561.316.8940

(Your Own) Private IslandJULY 25 FIJI JULY 9 LIGONIER, PA

JULY 18 CORRALITOS, CAJULY 11 NORTHERN CA

63-Acre Haven

Unique, 55-Acre Ranch125-Acre Estate

5 EXQUISITE PROPERTIES — ALL SELLING WITHOUT RESERVE

$4.25m$4.2m

$6.3m

R E C E N T LYR E C E N T LY

R E C E N T LY

$3.8mR E C E N T LY

PlatinumLuxuryAuctions.com800.262.5132

ADD’L JULY & AUGUST LUXURY AUCTIONS®

UPPER ST. REGIS, NY WELLINGTON, FL

Refer to PlatinumLuxuryAuctions.com for the relevant disclaimers and brokerage information for each luxury auction® property.

JULY 16 FISHER ISLAND, FL

Luxe Island Retreat

$23.9mR E C E N T LY