So you’ve outgrown your home but do you stay put and renovate/extend or is it time to sell and move on? Making your decision will come down to a number of factors including lifestyle choices and your budget. Here’s how to decide between the options.
What to consider?
When weighing up whether to think about renovating your existing home rather than moving on, ask yourself the following:
- Will the renovation be possible with local council planning laws?
- How long do you plan to stay in the local area?
- Does your current local area provide everything you need lifestyle-wise (ie, schools, shopping and community facilities, public transport)?
- Are you prepared to put up with living in a building site while your home is renovated?
- Do you have the time (and energy) to supervise builders and contractors and the overall renovation plans?
- If your answer’s yes to most of the above, then it’s time to look into all that a renovation entails.
The renovator’s challenge
Costs: how not to overcapitalise
When weighing up the costs of renovating versus moving, it’s important to be realistic about what your home will be worth at the end of the renovation to ensure you don’t overcapitalise on the property. You’ll need to do your homework and investigate the demographics of your neighbourhood, the style of housing and the sale prices of similar homes nearby.
From there it’s time to put a price to your plans. Architects cost less than you think and can save time and money. When plans have been drawn up, get at least three quotes from reputable builders and if you are serious about going ahead with the plans, check their references thoroughly.
In order to cover the costs, you may also need to take out a loan (or extend your existing home loan) to meet the renovation costs. It’s best to speak to your lender early on to make sure you have the available funds.
Local council approval
No renovation can go ahead without planning approval from the appropriate local planning authority so talk to your local council early on about your renovation plans to get an idea of their suitability for the property and chances of being approved.
From here you will need to lodge a formal development application for the property address, this process differs from council to council but usually involves submitting extensive building plans and proposals which will then undergo an approval process including plans being sent to neighbouring properties for comment. Depending on the particular council involved, this can take a fair amount of time (sometimes up to six months or longer) and needs to be factored into your decision.
Living with renovations
Deciding to renovate your home is a big step and one you have to be prepared for. It may mean months and months of living with building dust and materials in the front yard and contractors walking in and out of your personal space. Depending on the type of renovations you undertake, you and your family may have to move out of the home for a period of time which can add to your expenses if you have no family or friends to stay with nearby.
When to move on
It’s probably time to move on to a new home when:
- You want access to better schools, parks and community facilities.
- You’d like a bigger garden/outdoor area.
- You wish to be closer to family/friends.
- You’re looking for a quieter neighbourhood.
- Renovations are not really feasible or likely to be approved by the local council.
- Any major extensions/renovations would cause you to overcapitalise on the property.
- When the market presents a good time to sell value-wise.
But remember, they are also a lot of costs when it comes to moving house. You’ll need to consider the following when doing your sums:
- Cost of new home versus renovating.
- Stamp duty for a new property.
- Refinancing fees as well as costs to exit existing loan.
- Conveyancing/legal fees.
- Estate agents commission and advertising/marketing fees.
- Moving fees.
At the end of the day, deciding whether to move house or renovate is a big decision and one that will come down to you and your family’s particular lifestyle needs, and the costs involved.