I am having a hard time understanding why you will have the money to do it now, but not once he starts school? Why not keep the money in a high interest savings account, cd, or money market account in the meantime? If an emergency comes up, you have the money. If it doesn't, and you are thinking of selling in the near term, then go for the renovations at that time. An increase in home equity doesn't really do you a whole lot of good until you sell.
However, that's just me. My wife would probably not be able to mentally deal with terrible carpet and the likes. So I'd probably end up with a compromise. Do a couple of the unbearable items now, and bump up our emergency/home improvement fund with the rest.