Home Office Expenses & Options

You have several options for creating a dedicating home office:

  • Use an existing room and furnish it;
  • Build an addition to the home;
  • Hire a contractor to makeover an existing room.

But how much are the options and which will work best for you?

Furnishing an Existing Room

The  lowest cost option for creating a home office is simply to make over a den or guest room for your purposes.  Take the bed and nightstands out of the guest room, purchase a desk, chair, shelves and computer setup and simply fit it into the existing décor.

If you're only using the home office to pay bills and make a few phone calls in the evenings, this may just work for you.

Cost breakdown (assuming the electronics are already in hand)
Used Desk:  $150
Desk Chair:  $75
Shelving and storage:  $250
Office Supplies and Accessories:  $75

The desk, shelving and chair are usually available and inexpensive on the second hand market, so you could easily complete this project for under $600 – even $400 if you’re not picky.  If you want to really get fancy you can throw in a gallon of paint and an area rug for another $100.

Building an Addition

If you run a full time business from home and need a dedicated larger area, this may be a solution.  But that big, dedicated space will cost big, with the average home office addition costing up to a whopping $80,000 for the following using a contractor:

  • Add a 16-by-25-foot room on an existing foundation with vinyl siding and shingle roof;
  • Add an insulated drywall interior;
  • Install pre-finished hardwood flooring;
  • Install windows and glaze - up to 180 square feet;
  • Install atrium-style exterior doors;
  • Install two operable skylights;
  • Tie into the room into the existing HVAC system; and
  • Add electrical system to code.

But if you have a tiny house that needs a big upgrade, this may be worth the money, as nearly two-thirds of the cost will be returned in a higher selling price for your home.  Of course, if you’re using the addition strictly for business, you may be able to deduct part of the cost as a business expense as well.  So, it may not be such an outrageous cost as you might have initially thought.

Hiring a Contractor to Update an Existing Room

Now that we’ve seen the budget and luxury options, what’s the middle of the road solution for a dedicated home office?  Hire a contractor to turn an existing room into a dedicated home office.  Expect to spend up to $28,000 for this project for the following:

  • Convert an existing 12-by-12-foot room to a home office;
  • Install custom cabinets to include 20 linear feet of laminate desktop, computer workstation, and wall cabinet storage;
  • Rewire room for computer, fax machine, and other electronic equipment, as well as cable and telephone lines; and
  • Include drywall interior, painted trim, and commercial-grade carpeting.

Expect to get an approximate 50% return on your investment for a complete home office remodel, one of the lowest returns on remodeling projects in the home.

These estimates were based on the national average cost for home remodeling projects for 2008-2009 provided by Remodeling Magazine.  Of course, prices will vary, but at least you can begin making informed decisions as to your home office needs.

So, as they say on television “What’s in your wallet?”