Renovation vs. Restoration: What’s the Difference, Why Should I Care and How Can I Help?

This fabulous restoration was undertaken long before Alabama’s Historic Rehab Tax Program came into being.“Just totally renovated—shows like new!,” trumpets the MLS about a particularly lovely home. Another reads, “Restored from front door to rear porch and everything in between.” And if you are looking for a great older home, both of these will probably make your list of must-sees.

When you enter the first property, it is everything you are expecting. Quartz countertops dazzle in the kitchen that also boasts a professional 6-burner range and Sub-Zero refrigerator/freezer. An all-glass shower graces the master bath which is impressive in marble tile. And the list goes on.

But imagine your surprise when, upon entering the kitchen of the second house, you find nothing but a wall-hung farm sink, vintage-looking refrigerator and simple gas range. “Why are we here?” you ask your agent, your irritation obvious. “I told you I wanted a house had been completely redone.”

Turns out the agents who provided those MLS marks knew their stuff. Both houses had “been completely redone.” House number one had been renovated, and house number two had been faithfully restored…to its 1925 construction date!

The problem is this: in real estate circles, remodeling circles, heck—sometimes even in preservation circles—the terms are frequently used interchangeably. And they are used a lot!

Correctly applied, restored means that a property has been accurately returned to its former condition at a particular point in time, usually but not always the year it was built. Renovated, on the other hand, means renewed and may indicate that the structure has been significantly modernized. (Just in case you are wondering, to remodel really implies a change in the size or layout of a building.)

We historic house lovers come in two basic types. First are the preservationists who truly appreciate the original fabric of an old home They look for properties that have been faithfully restored. Examples would retaining lavender tile and fixtures in a residence built during the Art Deco period.

And then there are those of us who think we want an authentic old house but are really drawn to what I call “a new house in an old skin.” That homeowner type would light up in a kitchen with new IKEA cabinets, stainless steel appliances and granite counter tops!

More often than not, restoration is a great deal more expensive than renovation. So what’s the future for a truly important old house or building if “the numbers of restoration” don’t work? Fortunately, there’s hope. That hope is called historic rehabilitation tax credits, which help make an expensive restoration job more affordable.

The Federal government has had such a program for income-producing properties for over 30 years. And three years ago, the Alabama Legislature created a parallel program that works even on owner-occupied properties. That program has already seen 39 projects completed and an additional 13 projects are on a waiting list.

What’s more, the program is projected to be responsible for 2133 direct construction jobs. AND over the next 17-20 years, the State of Alabama will get back $3.90 for every dollar of tax credit granted.

That’s the good news. And now here’s the bad: Alabama’s program is due to expire May 15, 2016. If it is not re-authorized, Midtown’s historic homeowners and building owners will once again be “on their own” in getting their properties back to what they should be.

You can help. Call your state senator and representative TODAY and ask them to vote yes on HB-62, which will renew Alabama’s historic rehab tax credit for another 7 years.

That may not mean much to you personally today. And there just might come a day when you will be needing those tax credits to make your next restoration dream come true!

Sandra Nickel has been listing and selling residential real estate for over 30 years, most with an intense focus on Montgomery’s Midtown neighborhoods. Sandra serves on the Mid-Alabama Coalition for the Homeless, the Cloverdale Business Coalition, Historic Southview, the Volunteer and Information Center, Landmarks Foundation and her own neighborhood Garden District Preservation Association.

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