Should I renovate?

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There is plenty to consider when buying a home. Location. Size. Style. Price. One of the other important questions you might ask is, should I renovate?

If you have a limited budget, you might be looking at buying a home that needs work. Or you might be happy with your home the way it is, but feel renovation will increase its value when it comes time to sell. Or perhaps you’re are interested in making your home more eco-friendly.

Before you get out the hammer and nails, there are a few things to think about.

Plan and prepare

So you’ve decided you want to renovate a property you’re looking to buy. But before you secure the purchase, you need to know whether renovations will be worth the cost. If you are not an owner-builder, you will need to engage a builder or architect before the purchase, to get an idea of how much time and money is involved. Can renovations be done in stages? Will you be able to live in the home while renovations are being completed? What are the associated costs?

Drawing up a budget and a timeline before you secure the property purchase will mean you have a clearer picture of your financial situation. You need to know you have the means to sustain the mortgage on the property as well as the costs associated with renovation.

Determine why you want to renovate

Be clear about why you want to renovate, before you dive in head first. Is the renovation purely aesthetic? Will renovations improve your home’s energy use and output? Do you need more space for you and your family? Do you want to increase the house value?

If you know why you want to renovate, it will make it easier to weigh up your options.

Weigh up your options

Like most things in life, renovations cost money. You will need materials, and most of us will need to engage tradespeople. Will the costs and inconvenience of renovating be worth it?

If you are interested in increasing the value of the property, you need to look at median property prices in your region, and research sales trends. Determine whether houses with more bedrooms, or in better condition are in fact worth more than your house. Factor in the cost of improving your house for resale, and then not being able to get the price you are after to make it worthwhile.

You also need to consider the inconvenience of larger renovations. Removing the roof, kitchen, or bathroom will most likely mean you need to live elsewhere until the work is complete. Costs associated with relocating/renting must be factored into your budget. If you are planning to live in your house while you renovate, consider renovating in stages to minimise inconvenience. Read more about the pros and cons of renovation here.

If you decide that renovations are worthwhile, you will need to plan how and when these renovations will take place. Through planning will save you time and money in the long run.

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