To move or not to move? That is the question many homeowners ask themselves as the space they are living in becomes more crowded.
In today’s real estate market, where prices can be sky-high, moving may be the more expensive option. Many people look to renovation or expansion instead as a way of getting more value for their dollars. The decision is a very individual one that each family must make on its own because a number of factors affect the decision, including:
You’re not alone in debating this issue. Young couples who are beginning their families see their need for space expanding, while empty nesters look ahead and ponder whether they want to remain in a large home or downsize to a townhome or condo.
Naturally, not everyone comes to the same conclusion. 37 percent of the 850,000 people who changed addresses in 2012 told Canada Post that they were moving to upgrade their homes for family reasons. More recently, the Altus Group looked at home renovations and found that they yielded $68 billion in 2014, roughly $20 billion more than the amount spent on new builds.
Before you make a decision, sit down and take a good, hard look at your needs—now and into the future—and at the cost of each alternative.
Author Kira Vermond, writing in Moneysense, has an interesting perspective. She suggests that before you proceed further in your thinking, it’s worth making the space you have more usable by decluttering. As some homeowners prepare their homes for sale and staging by ridding themselves of unwanted items, they see that they have more space than they realized and decide to remain.
Think of all the things you may never touch again: old baby clothes, tennis racquets that you purchased at a garage sale and have never swung, or children’s school projects from years ago.
If decluttering seems daunting, hire a professional to help you. Today, there is no shortage of people whose livelihood is based on helping others decide what should be kept and what should be tossed.
Once you have a clearer idea of the actual space you have available, you can move forward with a decision about renovating vs. relocating. As you evaluate your options, remember to include all costs. When you move, for instance, allow for the realtor’s commission, land transfer taxes and the cost of the move itself.
In housing markets such as Toronto and Vancouver, where prices are sky-high, renovation is often the more practical option. You can work within the existing footprint to create more livable space by knocking down or adding walls or finishing a basement or attic.
Whichever renovations you plan to do, suggests master contractor Mike Holmes, have a set of blueprints made. Although they add an extra 10 to 15 per cent to the total cost, they allow contractors to make more informed, exact bids on the job. Otherwise, they may each focus on different details and you may be comparing bids that aren’t comparable.
Blueprints are also valuable in preventing the homeowner from making too many changes once the renovations begin. Unplanned changes can add another 10 to 20 percent to the cost of the project, says Jim Caruk in Style at Home, and your budget may not be elastic enough to allow for them.
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If you are considering renovations largely to increase the market value of your home, be careful. Renos don’t always add the value that you desire to a home. The Canada Mortgage and Housing Corporation estimates that you’ll recoup only 50 per cent of your initial investment by finishing a basement, while a kitchen renovation will return 68 to 73 per cent.
Do your homework before embarking on any renovation project to ensure it meets your needs, both financially and in terms of space.
Older homeowners who are looking toward retirement should also be conscious of the future as they plan their renovations. As we age, our mobility may become impaired and our flexibility may decrease. It is wise to factor in potential health concerns as renovation planning gets underway.
Having a toilet, shower, and bedroom on the main floor of a dwelling can be very handy if someone breaks a hip, for example. You should also consider such details as widening doorways to make them wheelchair accessible and adding a grab bar in the shower for anyone who is unsteady on his or her feet.
Whether you choose to relocate or to renovate, you’ll have the joy of enjoying a space that truly meets your needs.
If you have any questions about renovating your home or about home insurance, call 1.855.331.6933.
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