Make Sure your Home Renovations are Worth It
Posted by Brad Speniel | May 24, 2015 at 6:18 pm
ESTIMATED READING TIME: 3 minutes
I have previously talked about the benefits of making a house into your dream home with
home renovations. But when considering investing in renovations, you want to make sure you are taking on a project that will be worth it in the end. Before you decide to buy that fixer-upper you have your eye on, consider these tips to ensure it is the right house for you and that the planned renovations will prove profitable in the end.
Consult a real estate agent to find out more about the neighbourhood
The real estate history — that is, recent sales, pricing, etc. — of a neighbourhood will tell you if investing in this fixer-upper is worth your time and money. Your agent can advise you on community news, including property development, environmental projects and other factors that will have positive and negative effects on your home’s resale value.
Schedule an extensive home inspection
If you can already tell that the house needs work, you need to make sure that it isn’t just cosmetic. That said, structural work can be worth fixing, as long as it fits into your budget. It’s important to know which elements need to be fixed so you can work everything into
your budget. Invisible upgrades (like electrical, plumbing and heating concerns) can be expensive fixes that don’t always increase a house’s value.
Request an estimate from a contractor
Based on an assessment by a certified contractor, determine how much money you’ll need to set aside for desired upgrades. Knowing what your wish list will cost will help ensure your dream home doesn’t overextend your finances.
Know what you’re getting yourself into – both financially and personally
In accordance with the above point, when buying any house, you do not want to overextend yourself until you are drowning in debt. On top of that, fixer-uppers aren’t just hard on your bank account; they can be disruptive, stressful and time-consuming. It is essential to have a solid financial plan in place and your lifestyle taken into consideration prior to purchasing a home that needs renovations.
Work out a schedule
Knowing if and when you plan to buy your house can help you manage your renovation schedule and budget accordingly. For example, if you are planning to move in and begin renovating in the middle of winter, you may have to reconsider what gets done first. You won’t want to be replacing windows during a blizzard!
Know the law
Contact your local municipality office and request information on your city’s building permit laws before undergoing any renovations. If you are planning large structural changes, like additional storeys, additions, or decks, you may need to acquire a building permit. When or if you sell in the future, you may be asked for proof of permits on the
condition of sale.
Don’t over-improve for the market
Once the renovations start rolling, it can be hard to stop. Creating your dream home can snowball, but it is only worth it if your housing market will pay back your efforts. Make sure finishings (wood, stone, hardware) should be in line with the style of your home and the houses in the neighbourhood.
Before you get discouraged, trying to find a home that meets all of your wants and needs to no avail, remember that renovations are always an option. Talk to your mortgage broker to find out how to secure financing to complete these renovations and create your dream home within budget.