A perplexing decision any homeowner can face is whether to renovate or move. There are so many factors that can bring you to question which of these two ideas would be best, whether it be a growing family or just the desire for an upgrade. Here are some ways you can break down the decision further to decide what is best for you and your family. Start by asking yourself some critical questions, and be prepared to weigh the pros and cons of both remodeling and moving.
Why Are You Considering These Options?
One of the first questions to ask yourself in this decision-making process is, why? It’s important to know why you are looking to renovate or move. Understanding your reasoning is going to help you come to the best outcome. Take the example that you're outgrowing your space and need more square footage – something you have to consider is whether or not there is even the opportunity to solve this problem through a renovation. In some instances, you may not be able to simply build out a new addition to the home, at least not for more hassle than it’s worth. On the other hand, maybe you simply want to upgrade your home and finishes, and this may not require the upheaval that moving causes, and can be solved with a reasonable renovation. Ultimately, you have to really dive deep into the answer to this question so you are better equipped to take the next steps.
What Will Either Option Cost You?
Once you know why you are taking on this decision, you have to evaluate what you stand to gain or lose financially. If you’re interested in a renovation, you’ll want to be sure that the investment has the potential to benefit you long term. To do so, thoroughly evaluate your budget and financing options for such a project. Some options for financing a renovation can include using home equity, whether it be a home equity loan, or a home equity line of credit. There’s also a home improvement loan or the potential of refinancing. With all of this to go over, it would be helpful to speak with a trusted mortgage professional to discuss the best option for you!
If you’re looking to move, remember that sometimes this can be a lengthy process; not only because of house hunting but also due to the process it takes to best finance the home. You may be looking to sell, but there are additional options on what you can do with the space you currently own as you prepare to move to a new one, like turning it into a rental property! Either way, it’s important to bring in an expert to help you understand all of your options on how best to buy that next home.
Pros and Cons of Remodeling
One of the first pros of taking on a remodel is that this is an opportunity for customization, where you are involved in the planning and design process to ensure that the house is a direct reflection of your lifestyle and your design preferences. The second pro to remodeling is what it can do for your home value and equity. If a renovation is done with purposeful planning and budgeting, eventually over time there is the potential to earn a profit.
Consider a basement remodel as an example of the benefits of taking on such a project. There are a number of reasons why you may want to finish your basement, most often it’s to capitalize on the potential of space you already have that can serve so many different needs for your family. The fact that you’re taking on the renovation and not buying one already finished means you can consider a plethora of basement remodeling ideas in the planning process, and decide on how to make the space really special for you.
Like all renovations, there are key considerations to keep in mind, and doing your research is a necessary first step. In this case, there are certain specifications that allow a basement to be considered additional square footage in your home’s appraisal process. Yet, even in the event, the basement isn’t officially considered as additional square footage, this added feature can still increase the value of the home in the eyes of prospective buyers, leading to the opportunity for a higher offer if you ever did sell. If a renovation is done with intention it often can be well worth it. Remember important tips like not to overspend on the investment; a good rule of thumb for the basement specifically is to spend about 15 - 20% of your home’s value.
The cons of a renovation project are, first, the costs. Budgeting can be a difficult part of the process. Then, it takes extra care and attention to ensure that you stay on budget, especially in the event of unexpected expenses that you may only find out about after the walls come down.
The next con is living through the project. A renovation warrants tearing down a part of the home to build it back up, and this is certainly going to disrupt routines and can bring about a lot of stress. You should be sure to ask yourself if this is something you can currently handle. Now, the final consideration is that what you desire for this investment may not match the value of the area you are in. Therefore, you’re limited in what you should actually put into the renovation. If it’s not feasible for resale value and will actually make the house too expensive and drive buyers away, it may not be worth it.
A kitchen remodel is a large job and a prime example of what can be stressful and difficult when it comes to renovations. A kitchen is the center of the home, it directly affects daily routines, and manages a lot of traffic in and out of the house. So when it comes to remodeling one, you’re going to see a significant change in daily structure. As a result of this, it’s possible that you may incur additional costs such as eating out as a result of the loss of space, appliances, or other functional utilities. Another consideration, demonstrated in a kitchen remodel is that certain finishes and designs that you want for the space, may not make for a reasonable investment, therefore, impacting any potential profit in the event of resale.
Pros and Cons of Moving
The strongest pro of moving is the fresh start and new space that you can get without an intense project. It’s possible that renovating isn’t enough to satisfy everything you need, and moving is the best option to give you that. A new space is a great opportunity to embrace new design layouts and organization of the home that you just couldn’t have before.
Another potential perk of moving is the opportunity to change things like school district, neighborhood life, and job commute for the better. Choosing the right neighborhood is equally as significant a decision as choosing the right house. This too can have a direct impact on your quality of life.
While a renovation can disrupt your daily routine due to the direct changes being made to your home, moving requires the formation of an entirely new routine in a new place. One of the biggest cons to moving is that there is a lot to do to take care of the moving process. It can be tiresome and it can take weeks to months before you are able to get the new place fully in order. Changing your area will also have an impact on your daily commute and routine depending on where you relocate to. As with any change, there will be an adjustment period before you can settle back into normalcy.
The second con to moving is the loss of sentimental value. It’s normal to recognize the attachment that forms between you and your home. As you spend time there and create memories and experiences, you grow fond of and comfortable within your space. With that said, moving leaves this behind, and it can be difficult to let go. Depending on how far away you move it can also impact relationships with family and friends. Knowing whether or not this is something you can sacrifice will surely impact how you view this opportunity.
After evaluating each option, and tailoring it to your specific needs, you can decide what the best option is for you and your family. If you’d like help weighing out the financial pros and cons, or you find yourself leaning towards buying a new home, we’re here to help. From realtor recommendations, to financing options for a renovation, we’ve got your back. Connect with the team today and start making changes towards your new home!