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Renovate or Buy: What Should I Do?

September 13, 2021
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Most homeowners are often faced with the dilemma of whether to renovate their existing home or buy and move to a new home. Both options have their own advantages. 

When it comes to renovating, there is no major disruption in your life. On the other hand, moving to a new house could feel like a new start. Of course, both cost money and time. So before deciding which option is the best for you, ask yourself a few questions. Do you love your home and the neighbourhood? Do you see the home as your forever home? 

Housing prices and demand are rising with each passing day. While this might make you want to sell, remember that you’ll need to cough up the same amount or even more to get a new house. There is also the risk of not finding the perfect home for you. You might still be required to renovate it to a standard of your liking.

The beauty of making changes through a renovation is getting the chance to turn your home into your dream home without the cost of buying a new property. And what’s even better, is that you get to keep growing those family memories!

How to finance a renovation

There are two ways that you can finance your renovation project. One, you can pay cash from your savings, or two, you can take a loan. The choice that you take depends on the size of your project, your renovation goals, and your financial position.

  • Cash

Paying cash is the cheaper option since you don’t have to pay the interest that comes with taking a loan. However, if you are making major changes, you might need to take up a loan. If your goal is to improve the home’s value to sell it, taking out a loan makes sense. This is because you will be able to pay off the loan quickly and there is a return on investment.

  • Take out a loan

You need to consider a few things before deciding to take out a loan. For starters, consider whether your monthly budget allows you to make another payment. In addition, you need to know how much money you need for the project in terms of materials and labor. In this case, it is good to seek help from professionals such as general contractors

They can give you a rough estimate of what is needed to complete the project. However, while professional help is essential, you don’t have to break the bank while at it. Make sure that you compare a few quotations before settling on one. Thirdly, narrow down the loan options to one that matches your needs and to the lenders who are likely to give you the loan that you need. 

A guide to planning your renovation

The success of your renovation project lies in the planning. A good plan will ensure that you stay within the budget, hire the best experts and complete the project on schedule. Here are the steps that you need to take for a successful renovation

1) Develop a plan

When developing your plan, you need to consider the goal of your project. This will inspire the designs that you are going to choose. Consider all the details. The plan should also include the sketches of the completed project, all the requirements for the project as well as the steps to take whether yourself or working with a professional. 

2) Set a budget

Having a project budget in place ensures that you don’t spend beyond what you can afford. Take a good look at your finances to determine the amount that you can set aside for the project. Align all the costs to fit within the budget. This might mean reviewing some elements in the plan if they prove too expensive. Remember to add about 10% of the budget for any surprises. 

3) Hire the team

If you are going to require help, this is where you start hiring it. Ensure that you do your due diligence in terms of the costs, experience, and reliability before making your choice. 

4) Decide the timeline

The easiest way to build a timeline is to decide the specific time that you want the project to be completed. Ask the experts how long it is likely to take to complete everything and then work backward to determine the start date. It is also important to determine the timeline of each portion of the project. 

5) Apply for permits

With a team in place and a clear timeline, you can now apply for permits if the project needs one. Do it way before the start date so that you can have them ready in time. 

How to save on renovations

Renovations can be complex, which makes it possible for costs to get out of control. It’s good to look for ways to save money and caution yourself from such a possibility. Besides, renovations don’t have to be expensive, saving money should be a priority. Here are a few ways to do so:

  • Save up for the project to avoid interest fees on loans
  • Take up DIY tasks yourself rather than hiring a professional
  • Recycle materials
  • Take advantage of sales and offers when buying materials and appliances

Conclusion

Renovating or buying is always a big decision that you need to make. But renovating makes sense for a number of reasons—if you decide that renovation is the best option for you, use the tips we talked about to find financing and plan ahead for the project. Additionally, whether the budget is huge or small, saving up is important. The best way to stay prepared is to take preventative measures.

And if you’re still gunning for that new home, we can definitely help you out. Browse Soho’s search page for thousands of listings. And better yet, take the heavy lifting out of the search and set up your match profile. We’ll send you the best potential listings in your criteria.

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