How to decide: renovate or relocate?
JD‘s always talking to people about their renovations and whether it’s worth their while to go ahead. “We can’t decide whether to renovate or sell,” they say, juggling home magazines and real estate websites. Recently, he was talking to some customers who wanted to replace a couple of doors. By the time he’d spent an hour with them, it turned out they wanted to change more than a few doors.
They didn’t love the area where they were living, but it was close to family and that was important to them. They figured that they’d make a few changes and fall in love with the house, if not the location. There were numerous meetings, they purchased some floor tiles, JD introduced them to an architect, they got really excited and then gave JD their final wish list. Those “few changes” turned out to include three new bathrooms, replacing all the doors and windows in the entire house, new flooring upstairs and down, creating a grand foyer and rendering the entire house. Right.
JD sat down with them and together they put costs against the wish list – that came in at a little over $500,000. The homeowners knew that this was a reasonable price for the extensive work that was required but it also made them realise that while they could spend that money and end up with a lovely house, they’d still be living in an area that they didn’t really like that much (even though mum and her awesome family meals were close by).
Instead, they put the brakes on the large majority of the building work and purchased a new house in the suburb they really want to live in. Result! Bummer for JD as he missed out on working with a couple he really got on well with, but he was pleased that they made the decision that was right for them. Sometimes, you have to go a fair way through the planning process to realise that maybe a renovation or rebuild is not the best solution.
Here are five things to think about if you’re trying to decide whether to renovate or relocate:
Do you like the location? You can change a house but you can’t change the location, the orientation or size of the block so think hard on how you feel about the location. Some site issues can be overcome with good design and materials (double glazing if you’re on a busy road or moving living areas to take advantage of a northern aspect) but some definitely can’t (that flight path isn’t moving anytime soon).
How much do you have to spend? More than once we’ve dealt with customers who have had plans drawn up, only to discover that they’re going to cost twice as much as their actual budget. Rather than compromise on the design or put themselves in a ridiculous amount of debt, they’ve sold the house and moved on. This is also a good reason to get a builder involved early on, so that you can be aware of costs before you’ve gone to the time and expense of having an architect or designer draw up plans that you then discover you can’t afford.
What is it that you want to change? Maybe you don’t need a full-scale renovation but more of a reorganisation of your rooms. Need a second living area for the kids? Perhaps you could move into the smaller bedroom and give them the master suite that will double as their playroom. Or maybe you can carve out a much-needed study or office area with some clever built-in furniture.
How long are you planning on staying in this house? If you and your family are in it for the long haul, moving only when your youngest child (currently about to start kindergarten) has married and moved out, then by all means make big plans and execute them. If, however, you think you’ll only be there for 3-5 years, make smaller changes so you don’t run the risk of over-capitalising and not recouping your investment when you sell.
Do your numbers. If your renovation budget is $300,000, add that to the current value of your home to give yourself a budget for a new home search (don’t forget to factor in 4% for stamp duty, 2% for the real estate agent to sell your current home and at least $10,000 to cover moving, legals, marketing and potentially, staging). If you find something you love in that price range, then relocating may well be the right option as it’s simpler and quicker than dealing with a full-scale reno.
Are you trying to decide whether to renovate or relocate?
What’s the biggest change or upgrade you’d like to make to your home?