[Greenbuilding] Rebuild or Refurbish or..?

[Zach Douglas]

Hi, this is my first post here.  I have read some of the previous 
digests and you guys seem to know quite a bit.
My question is not entirely about green building.. at least not yet.. 
once I move on and make a decision on my current situation I'm sure I'll 
have some questions that are more related to the focus of this listserv.

Here is my situation and a question I would like to pose to you all...

I purchased my house in Austin about 5 years ago. It's a 1300 sq foot 
2-1 built around 1940.  It has gone up in value since
I purchased it and I do have some equity in it.  While it's not in 
terrible shape, it's starting to develop some issues. Also, even if the 
house
didn't have any issues, I would like to build a custom (green) home.  I 
do like my location and neighborhood and I see this area as continuing 
to appreciate
and I would like to keep the lot I am on.  Most people tell me it is 
crazy to try and build a new house where my old house sits now and that 
I should just add-on and refurbish my old house.  I see some problems in 
doing that but I am open to it if it was more economically feasible AND 
I could achieve the same results.

Reasons and problems with my house now:

A. House is small and 2-1 so it will never appreciate or be worth as 
much as a larger 3-2 in this neighborhood
B. We could use more room and more storage
C. A laundry room was added on to this house that was a disaster.. 
poorly built and it leaks water (moldy)
D. My wiring is original cloth covered aluminum wiring + a dishonest 
'contractor' screwed up a lot of the wiring in my house.  Most issues 
are inside the walls and I don't see any easy fix for this. 
E.  I'm pretty sure I have all lead paint under the more recent paint
F.  I may have asbestos insulation under the fiberglass insulation in my 
attic (how can I find out if this is true?)
G. I've recently developed some roof leaks and have noticed that some of 
the boards on the roof are rotting or damaged.
H. The plumbing is as old as the house and it's developing some problems 
too.
I.  The windows all around the house are large old style windows that 
are very drafty and in pretty poor shape. They are the kind on vertical 
hinges that can be opened out with levers at the bottom. They really 
need to be updated. You can see daylight through some of the cracks as 
they don't seal.
I.  I could come up with similar laundry lists for each room and how 
integral parts are starting to wear out OR are just too small (bathroom 
tile, kitchen tile, no room in kitchen for dish washer, small counter 
top space, and so on)

So it seems I have several options:

1.  Sell the house to someone and have it moved from the lot and build a 
new one on the lot
2.  Tear down the house, recycle what parts can be re-used and build a 
new house on the lot
3.  Refurbish and add on to my current house which might mean removing 
everything except the foundation and floors and even some of those would 
have to go such as in the laundry room.

Which is the most feasible economically or otherwise?? 

Just recently a crew started working on a house down the street from us 
that looks similar to ours in age.  It looks like they completely 
removed the walls and roof of the house and replaced the supports and 
studs and then are going to rebuild the walls and roof from scratch.  
And they appear to be adding on a room to the back of the house.  This 
seems like an OK idea although from my perspective it looks like they 
all but tore down this house so I am wondering if there is an advantage 
I don't know about to not completely tearing the house down?

I'm also interested to know where I should start with all this...  
should I figure out the cost.. or talk to the city about what I can 
do... or talk to an architects.. 
I figure maybe it was best to start with some people like you who might 
have gone through something similar and could tell me what to expect.

Thanks for any suggestions and or starting points