If your current home is no longer meeting your requirements you may be faced with the decision of whether to buy another or stay and renovate.
Things to Consider
Is it important to stay in the same location?
If you love the suburb you’re currently living in or need to remain in the area for school or work, staying in the same location could be a priority. You’ll need to decide if seeking a suitable new home within close proximity is the best option or if renovating is feasible. If you have no ties to your current area you might look somewhere new that offers everything you need and want.
What’s your budget?
Is it more cost effective to buy another home or will it be more economical to renovate what you have? Spend time looking at potential homes and conduct preliminary renovation planning and costing to get an indication of what might be the most affordable option.
Can you renovate your home without changing the floor plan?
It costs less to renovate your home – almost 50 percent less – when you don’t change the structural elements so evaluate carefully what your needs are and what you’re willing to settle for if you remain and renovate.
Will renovating increase your home’s value?
Some renovations can increase a home’s value, while others will ultimately be wasted money when it comes time to sell. If you have an older home on a large block, you’re likely to attract developers who will focus on the land value and redevelopment opportunity regardless of any improvements.
How will your mortgage be affected by a move?
Buying a new home could mean a lower mortgage – depending on market conditions. It could also mean you are paying much more. Do your sums before making a decision.
Renovating vs Buying: The Pros and Cons
Once you’ve considered what your requirements are and what you’d prefer – buy or renovate – it’s important to weigh up the pros and cons.
Relocating Pros:
- New beginnings: You get to start over in a new home and possibly a new suburb that will suit your current needs. You’ll have the potential to meet new people and experience new things.
- Financing: Once you’ve bought your first property, it’s typically easier the second or third time around to go through the purchase process. Shop around for a lender who will give you the best deal or use a mortgage broker.
Relocating Cons:
- Costs: Selling and buying a home typically involves a range of other fees including marketing fees, stamp duty, building and pest inspections etc
- Stressful: Moving can be very stressful especially when it comes to finding the perfect home in the perfect location, then preparing for moving day by de-cluttering years of collected items and finally, packing.
Renovating Pros:
- Costs: The cost to renovate your home can be less than buying a new home depending on the extent of your renovation. You can tailor up or down depending on your budget.
- Personal touch: Renovating allows you to change your existing home to meet your personal requirements and style.
Renovating Cons:
- Financing: Renovating typically requires dipping into savings, obtaining a loan, or using home equity. It may be difficult to obtain funds if you haven’t got a decent amount of equity in your home.
- Disruptive: Renovating means you’ll be living in a construction zone for days, weeks or even months. Choosing alternative accommodation can be costly and inconvenient while staying in your home can be noisy, dirty and stressful.
Before you make the decision to buy or renovate it’s important to have your home appraised and know the current potential sale value of your home along with what it will cost you to buy in the same or another area. Talk to a Noel Jones property expert today.
