What do you do if you love your home’s location and the area, but the home no longer fits your growing family’s needs? Do you stay and renovate your existing home or find a home that meets your developing criteria?
“At some stage, many homeowners, particularly those still living in their starter homes, will be faced with the decision of either moving or renovating their existing home to accommodate their needs,” says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
Many homeowners, particularly those still living in their starter homes, will be faced with the decision of either moving or renovating their existing home.
“The decision will largely be determined by various key factors such as whether the existing home has the necessary space for additional rooms needed to accommodate the family’s changing situation. There is also the question of affordability, and which choice makes the most sense based on the homeowner’s financial situation,” he says.
There is no right or wrong answer to the question as the determining factors will differ them from person to the next based on their individual needs and circumstances. The choice needs to fit in with your lifestyle, criteria and financial standing.
“With property viewed as a long-term investment, many buyers purchase a home they know they will be able to add onto when the need arises and their budget allows. However, there are also buyers who purchase a home that is right for them at the time, but know that as soon as their situation changes they will have to relocate,” says Goslett.
Both options have their pros and cons, but there are steps that homeowners can follow to assist them in making the decision a slightly easier one. The first step is to determine the value of the property, as well as the estimated cost of the required renovation.
“It is vital to factor in all costs involved in the project such as the materials and the labour costs of the contractor. Where the renovation impacts the structure of the home, you will be required to get a building inspector to sign off on the plans before any work on the project begins,” he.
It is advisable to add an additional 10% to the renovation costs to cover any unexpected issues that may occur during the project’s construction. Once an estimated figure has been established, you will be able to compare the cost of the renovation versus properties you would be able to purchase by adding that amount to your existing bond.
Selling your home has the benefit of being much simpler than renovating; simply move in to your new home with nothing to do but unpack! You don’t have to put up with the inconvenience of living among chaos for months on end and you can determine most of the costs up front.
However, it’s unlikely you’re going to find everything you want in an existing property so you’ll probably have to compromise on some features. There are also a number of costs associated with moving including stamp duty, removalists, agent fees, refinancing, pest and building reports and more.
There is also a chance of not finding anything within the price range, which means it would be more feasible to undertake the renovation project. One way or the other, comparing apples with apples will help make the decision.
“Before renovating or adding to the home, it is best to find out the average property price in the neighbourhood. If the renovation costs exceed the average house price, it may be quite a few years before you would be able to sell the property and recoup the money spent on the project,” says.
“The decision to renovate or change a home is not always about increasing the home’s value or for the purposes of resale. Very often the renovation is to improve the living conditions or lifestyle of the home’s occupants. Often it is emotion that drives the decision, not cost,” says Goslett.
Either option has both positive and negative elements, however, each also provides an opportunity to move one step closer to owning your ideal home.
Here are some guidelines to consider for those looking to answer the renovate-or-move question:
When renovation is the better option:
- You love the location of your home and the .
- You can tolerate living in a construction site or moving out of the house for a while.
- You want to have complete creative control.
- You have a reliable building .
When moving is the better option:
- You want to change your location, for example, in search of better schools or a shorter travelling distance to the office.
- The disruption of a renovation is too much to handle.
- Renovations may cause the property to be overpriced for your area.