Given how expensive and time-consuming renovations can be, it’s important to weigh how you can best spend your money when altering your home. Start by asking yourself what you are trying to achieve….
Here are some common reasons that drive homeowners to renovate:
Enhancing functionality and enjoyability for personal use. In these circumstances, I would encourage homeowners to audit their home to see what’s working and what isn’t for them, as well as what they need and what would be nice to have.
Questions to ask when determining this include: how many people live in the house and does the space meet their lifestyle preference adequately? If it doesn’t, what is it lacking? Is it storage, space for entertainment, a home office, or all of the above? Do they cook a lot? Is the decor of certain spaces dated and does it need sprucing up? Answers to these questions will inform the changes to the property that will make it more functional and enjoyable for those living there.
People often assume the more renovations are made, the more the value of a property will increase. That may not always be the case. Indeed, some renovations can lower the value of a home; for example, turning a two-bedroom home into a one-bedroom house would typically reduce its value.
Upgrading a home to create more equity when it’s sold ultimately. There is plenty that can be done to increase the monetary value of a home. Generally speaking, having updated bathrooms and a kitchen, as well as a finished basement may well add value to a home. But installing energy-efficient appliances, freshly painting the space and landscaping the property beautifully will help make the property more salable. However, it may not add appreciable value to the sale price.
Buying an investment property to get the best return. Some people will buy fixer-upper properties to renovate and sell, or create a basement apartment, to generate additional income. If this is something you are interested in, hire a real estate agent and let them know about your intentions. They can provide valuable guidance on what to look for in a suitable home.
If you are considering renovating, here are some tips:
- Review your finances, set a budget you are comfortable with.
- Shop around and consult with several contractors before securing any services.
- Do research to see if the renovations will require permits. Make sure you have those in-hand before work begins.
- For basement apartments, check the municipal rules and bylaws to ensure they are allowed and what steps need to be taken, including inspections.
- Consider consulting a local real estate agent to get their thoughts about your ideas. Ask them to share their experience about the impact of renovations on the resale price, the desirability of changes for other buyers when reselling, even what others seem to like. Remember, they see hundreds if not thousands of homes every year!
If you have a question for Joe about the home buying or selling process, please email [email protected].
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