The following is a question that I get a lot and with this question it produces more questions than answers, it is a very broad subject and always takes me multiple parts to answer, here goes.
Q:
I am in a situation where I am not sure whether to renovate an existing house or to sell it and move on to another home or possibly build a new home on another piece of property.
A:
Before you decide on what to do with your current home you should ask yourself a couple of things first;
1. Do I like where I currently live, neighbours schools, distance to work? Or is there another neighbourhood or area that I have dreamed about living in?
2. Do I like the house and lot that I currently live in?
3. Can your current home give you what you want in a home?
4. Is it worth it financially to put money into my current home, will it bring me a return on my investment when I go to sell it?
5. Is the home large enough for me or would I have to enlarge the home from its current shape and size?
The more of these questions you answer "no" too or are completely undecided on should help you decide if you really want to get into the renovating of your current home. If those questions didn’t sway you to a decision then read on.
When considering to extensively renovate a home like you are suggesting there are a couple of areas of the home that are more expensive to remediate but they do not give you a lot of return (i.e.; comfort to buyers in resale). These are areas that people do not see but are essential to the working of the home. They are as follows;
• The foundation. Foundation work and waterproofing of the foundation are expensive and disruptive to the landscaping around the home. If you are planning to add an addition to the home having foundation problems will make it a more complicated matter to attach too.
• The insulation. To re-insulate an older home properly you basically have to gut the entire home and start from scratch taking all the walls back to the studs.
• The heating system. Depending on the current heating system it can cost you a lot of money to upgrade. The larger costs are associated when you are converting a home with baseboard heat into a home with a forced air furnace or if you want to install Geothermal heating because you live in the country and you don’t have access to natural gas.
• Re-wiring the electrical. Basically damaging every wall in the house to update old and dangerous electrical lines.
• Re-plumbing. This usually consists of taking most of the walls and ceilings back to studs.
All of these things that I have listed above are vital to how your home functions and performs. The problem is that for re-sale it’s nice to tell people that all of these expensive things have been done but a perspective homebuyer doesn’t put as much value on them as they do a brand new bathroom or new floors. This means that the return on your investment can be a lot less.
Usually when you start repairing some or all of the things listed above (unless the possible return on your investment is large) I would recommend selling the home and moving on to something else that has far fewer problems.
Now even if your home does not require a lot of the major repairs that I have listed above you still must ask yourself how much do you really want to spend on your current home as you attempt to re-configure the inside to fit what you want it to be from what it currently is.
Renovations are more expensive per sqft then building a new home, the simple reason is that it is more labour intensive to renovate a home then building a brand new one. That doesn’t mean that a new home would be cheaper to build then extensively renovating your home, but it does pose the question of if you are going to get a proper return on your renovation investment.
The other question that you should ask yourself (if you do like the idea of renovating a home instead of building a new one) is that if you don’t think it’s worth it to renovate your current home then you could always sell it and buy another home that does require you to renovate it but that home will have a greater chance of giving you a positive return on your investment.
With careful thought you should be able to make a decision on what you should do. If you are still thinking of renovating the current home that you live in I would recommend calling a contractor like me in and getting their opinion. They should be able to tell you a rough value of the work needed and they should be able to tell you about what state some of the more expensive parts of your home are if they do indeed require repair or replacement.
Rob Abbott
Village Builders
No comments:
Post a Comment