The Big Decision: Buy a New Home or Renovate?

In the past few years, the surge in home renovation television shows has many people intrigued with the idea of renovating their own homes. Additionally, with COVID-19 and the uncertainty of lockdowns, families spend more time indoors and are contemplating new homes that give them more space. Nevertheless, renovating your existing space can be a hassle, but so can packing up and moving to a new one. However, there is a lot to ask yourself before you buy a new home or renovate.

Before you start knocking down walls or signing the deal for that modern house you drive past every day, here are some factors that you should consider.

Questions to Ask Yourself

  • What is my budget? Your financial situation is a significant factor to consider. It is an important factor when making the big decision to buy a new home or renovate. If you are only intending to make minor changes, renovating your home can be more cost extensive. Often renovations are less expensive than buying a new home. However, if you are planning an extensive renovation with many structural changes, it may be better to buy new.
  • Do I love my neighbourhood? Finding a new home that fits your needs in your current neighbourhood can be difficult. Therefore a home renovation may be more suitable for you. With renovating, you can stay in your ideal neighbourhood whilst also upscaling your existing space.
  • Will my renovations have a good return on investment? Speaking to a property specialist can assist you in determining whether you can recoup any spendings on improvements. If you are likely to get a good return on investment, then renovating may be more beneficial.

Have these preliminary questions given you a better idea of which option is more suitable for you? If not, here are some advantages and disadvantages of buying a new home or renovating.

Buying a New Home

Buying a new home

Packing up and buying a new home can be an exciting decision. The most significant benefit being settling into your newly purchased property immediately. Here are some of the advantages and disadvantages to assist your decision:

Advantages

  • New Beginnings: whether it’s moving to a new suburb, city or state – packing up and moving is a great way to declutter your things, meet new people, re-decorate your home, and start a new chapter of your life. Furth
  • Low maintenance: because new homes come with new plumbing, heating and appliances; therefore, you will not have to deal with any urgent maintenance.
  • Fast results: one of the most obvious benefits of purchasing a new home is being able to settle in immediately. You can skip the whole living in a construction area and go straight to unpacking your things.
  • Energy-efficient: most new homes today are built for our new green-aware society, with most new homes coming with solar panels, low-energy appliances and insulated walls.

Disadvantages

  • Costs: the process of selling your current home and buying a new home involves stamp duty, refinancing costs, real estate agent fees, legal fees/conveyancing costs and building inspection reports.
  • Moving: moving can be a lengthy process that involves sorting and throwing away your belongings. Additionally, you will need to factor in time to move your belongings from one home to the other, and this can also involve the costs of hiring movers. If you don’t have the time to pack and unpack, moving can be a hassle.
  • Process of selling your current home: preparing your house for the market can be onerous. You will need to take carry out some repairs in order to take photos of your home for putting it on the market.
  • Lack of personalisation: Most new houses today feature generic floor plans that lack personalised touches.

Renovating

Renovating

The proliferation of home renovation ideas on the internet may have left you contemplating whether you could remodel your outdated home. Here are some factors to consider:

Advantages

  • Personalisation: renovating allows you to modify your existing home to meet your lifestyle and expectations. Compared to buying a home that may not tick all your boxes, renovating gives you complete creative control.
  • Added value: homes are a significant financial investment. If you purchased your home at a low price, you have the potential to increase the value of your home. In the future, if you decide to sell your home, you will get a higher return in your investment on the property.
  • Costs: the cost of renovating your home as opposed to buying a new home is less as it is done on a room-by-room basis.

Disadvantages

  • Not for extensive renovations: if your current home needs a major overhaul, then a renovation may not be cost-efficient. Renovations are not suitable if you intend to upscale every room in the house when you could equally buy a new home with all these updates done for you. A complete do-over will incur further costs that buying new would not incur.
  • Timelines: one of the most arduous cons of renovating is having to live in a construction site for a lengthy period. If the renovation covers the whole house, you will need to find alternate housing for the time being. Not only will this cost more, but the living situation may persist further due to any unforeseeable complications. Therefore a significant amount of patience is required.
  • Compliance: renovations come with the added burden of obtaining relevant construction permits and ensuring your plans adhere to numerous building codes.
  • Costs: renovating your existing space can also incur a plethora of costs of labour, materials, permits/council fees, design fees, inspection costs, and repayments of any finance required. Although some renovation projects can be cheap and easy to complete, extensive modifications may quickly go over your budget.

When making the big decision to buy a new home or renovate, these are the key advantages and disadvantages to weigh in the process.  The decision essentially comes down to your financial situation and personal preferences.

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