Should I Renovate My Existing Home or Build a New One?
Part 1 of a 4 part series
For the next month, we're going to be discussing renovation—what you should be doing, questions you should be asking, and things you should consider. At Springhouse, as we’ve been receiving more and more calls about renovation, many of the questions center around this general theme: Should I stay, or should I go? A lot of work can be done to existing structures, and many times, it does make sense to stay and renovate—especially right now.
Many people can't find a house in the current real estate market—some would like to sell so they can either move up or downsize to a more appropriate home for their lifestyle. If they do find a house, they're bidding against 12 people. You could build a new home, but that seems like a lot of work. Plus, lumber prices are high.
You might be struggling to put into words what you want, and we’re here to help define it for you! You’ve worked hard to get where you are, and you want to live in a beautiful home that supports your best life. So, let’s make that happen! Today, we’ll be discussing whether you should sell your home to either build a new one, find one on the market, or renovate the one you’re in. How do you decide? How can you make a confident move one way or another? Should you stay or should you go? With the harsh realities of today’s market, you have four big decisions to consider...
What is your heart telling you?
Our homes are everything to us. It's where we decompress, feel safe, meet our loved ones and rest at night. It should be your refuge from the world! So, you need to ask yourself: Do you love where you are in your heart? Do you love the neighborhood you're in? Are you friends with your neighbors? Do you have lovely memories you don’t want to leave behind? Do you enjoy the setting?
We’re currently working with a couple of clients who were recently struggling to decide whether to build a new house or renovate their existing one. They absolutely loved the setting of their home—however, the house, itself, was not working for them in this phase of their life. Ultimately, they decided to completely renovate their home: changing bedrooms, creating a den, blowing out the kitchen, etc. This couple is a perfect example of making your current home work, simply because you just love something about it.
Is it economical to renovate your existing home?
What does your budget look like at the moment? Will your location hold the appraisal value after renovation? Are you already the largest or most expensive home on your street? How will you finance a renovation? Do you have the equity to borrow against? Money is very cheap right now—especially mortgages, which won't last forever.
Did you know that you can essentially get a construction loan for renovation? Your architect can design the renovation, you turn it into the bank and ask for a loan based on the appraised value of the home once it’s finished. Sometimes this process works with entire home renovations. Say you want to buy a house in a location you like, but hate the home. Well, you can do construction financing for the end value of the home. Pretty interesting!
Another important consideration: How long will you be in the home? How long will you have to recoup the money? You will never get every dollar back from a renovation (although, there are some renovations that pay you back more than others). In this case, the day-to-day value—aka, the enjoyment you get from your renovations—may be more important than the dollar-to-dollar value.
Before Renovation
After Renovation
Is the structure and infrastructure of my house in good condition?
Do some legwork. Before making your decision to renovate or build, you’ll want to investigate the structure and infrastructure of your house. Is it solid? Is it in good condition? We’re usually pretty aware if we have water damage, sagging or foundational issues—but what about the infrastructure? Do you have to replace all the electrical in your house? Is the plumbing old or made of bad material that you’ll need to redo? Will you be replacing HVAC systems or separating them and running new ductwork? People don't usually think about these considerations, but they will certainly suck up your budget quickly.
Ultimately, we want to put money into our experiences, but the “boring” stuff is just as important. It's all a balancing act. Keep these things in mind as you think about renovating your home.
What level of disruption can you stand?
The level of disruption a renovation brings depends on your lifestyle and what you’re renovating. Kitchens are obviously going to be a huge disruption, as well as a master bath—that being said, you usually have another bathroom to get you through for a few weeks. During the renovation process, there are people trekking in and out of your house during work hours. So, if you're working at home, and kids are in school at home, then you need to consider how much disruption that is, how loud it is, which parts of your home could be closed off, etc. Plus, you need to consider that delays, cost overruns and unknowns happen in every single renovation project. It will happen in yours, I promise. It happens, so we account for it in the timeline and budget.
Have any questions?
There are many positive things to say about a new build, but take the time and decide which direction is right for you. The best way to answer these questions is to pay for a consultation. The cost of this depends on the deliverable, which could be anywhere from $500 to $2,500. That being said, a paid consultation will help you find out what problems you're going to be solving and what problems you might run into.
Although we covered a lot in this post, you may still have some other questions about renovations. Whether you’re involved in the custom home process now, or even just considering it, join our free Facebook group—we’ll help you answer any questions you might have! Also, feel free to invite anyone that you think would benefit from this collaborative. You’ll not only get advice from me, but from other people who have been through this, too.
Start the process.
When it comes to designing and building a custom home, nothing beats having a trusted, experienced team of architects on your side. Let’s set up a call to meet, discuss your goals, answer your questions, and settle your fears. We can’t wait to meet you!