Should You Renovate or Build A New Home?
In deciding whether to renovate your current home or build a new one, there are many factors to consider. The first consideration is financial. What is the better investment in the long run: renovating an older home or starting new? The second is about your lifestyle. What are the most important features to have in your home, and how do you envision living in the space? Finally, how do emotional considerations affect your decision?
Financial Considerations
Typically, on a cost-per-square-foot basis, a major remodeling project is usually more expensive than new construction. Why? With new construction, you gain efficiencies with subcontractors and materials. Since the project literally begins from the ground up, the various elements of the construction process proceed in a specific, well-planned order. Other than unanticipated weather conditions, there are typically few surprises when you work with an experienced, professional homebuilder. Remember, whether or not you are building a new home or renovating your current home, there are additional financial factors to be considered when creating your budget, such as architectural fees, financing and closing costs. With new home construction, don’t forget to add the costs of moving expenses to your budget as well.
Certain costs are associated with renovations that are not with new home construction. Renovation projects involve “deconstruction” which adds to the cost of your project. For example, drywall, cabinetry, flooring, windows and doors often must be removed before construction can begin. Even when working with experienced professionals, there usually are surprises along the way when renovating an older home. For example, removing walls and tearing up floors means finding unforeseen issues, leading to higher construction costs. A 30-year old home may need new HVAC systems, new plumbing fixtures, a new roof, new exterior finishes, updated electrical systems and much more. While some of these issues are identified in advance, sometimes they are uncovered when the remodeling process is well underway. Planning for these contingencies in your budget is essential. Also, ask yourself, when it is all finished, will the cost of remodeling your home outpace its resale value? Or, are property values steadily rising in your neighborhood?
Lifestyle Considerations
Your older home may have a design and charm that you cherish, but you simply want to update its functionality. For example, your current home works for your lifestyle, but you need a new kitchen, bathrooms and internal systems. In this case, remodeling may be the right decision for you. However, keep in mind that some characteristics of older homes, such as lower ceiling heights and lack of energy efficiency, are very often difficult to address in a cost-effective manner with renovation.
If you desire a modern-day, open-concept floor plan and other features that new construction provides, that may be difficult to achieve in an older home. Even with a whole-house renovation, you may never attain the features that brand new construction innately offers, such as higher ceilings, larger overall room size and greater energy efficiency and comfort. What features in a home are most important to you?
Emotional Considerations
Do you simply love your neighborhood and can’t imagine living anywhere else? Are your neighbors like family and therefore moving is out of the question? If your answer to these questions is “yes” then the emotional considerations of staying in your home and renovating may trump the idea of brand new construction. However, if your current home is never going to fit your needs – even with a major remodel – then building a new home may be for you. It may mean living in a new home in a new neighborhood and meeting new wonderful neighbors. Or, could a teardown of your current home to make way for a brand new one be the right answer for you?
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