Renovate or build a new home: Which is Better
- May 14, 2019
- Posted by: admin
- Category: Cost Saving tips
To paraphrase Shakespeare, “To Build, or Remodel, that is the question?”.
And it’s not a lighthearted proposition either dealing with house and renovations costs.
Every year, hundreds of Perth and Western Australians ask themselves just that?
Should I risk, designing a dream home from scratch, or should I remodel my house, or purchase a less pristine home and remodel it?
The answer, of course, like all home purchasing questions, is that it depends on your needs.
There are plenty of advantages of going the renovating route especially if its a single kitchen or bathroom.
But as well, there are advantages to building a home from the beginning.
In this article, we discuss the upsides of building a new house or renovating.
Advantages of Buying and Renovating an Existing Home
There are many reasons why people consider existing properties, regardless of whether remodelling is thought of or not.
These reasons include:
- Purchasing an Existing Property Comes with the lot, which alone can cost you $200,000 or more to buy.
- You are more likely to get closer to the CBD if that’s what you are looking for. It is much harder to find a block of land close to the CBD.
- Another factor is property size. In the past properties were much more significant than existing lots, so unless you’re prepared to buy two lots to build on, plan on a smaller house and yard.
- Consider the foliage factor. Take a drive in an area with plenty of new home construction and compare it to an established neighbourhood and you will notice a huge contrast in greenery. Existing neighbourhoods often have established shade trees, mature gardens, and maybe even parks to play with for your kids. New build home areas are often sparse on foliage.
- If you purchase a new home, you can often be living in it in as little as 30 days. While a new home may take a year of construction, during which you may need to pay rent for a year.
- Finally, purchasing an existing home offers you to quickly stage-up to approximate your dream home. Remodelling a kitchen, followed by a bathroom remodel can quickly shoot up the value of your home, not to mention it’s livability, and you can do it in a piecemeal fashion.
Of course, there are advantages to building from scratch as well. These include:
- Being able to plan your dream house with all the details you and an architect can design
- Building to size for an expanding family immediately
- Generally better energy efficiency leading to lower energy bills
- If the home is an investment property, there are certain tax benefits
- You’ll only have small maintenance costs over the first few years, as most newly built homes come with a limited warranty
Also, according to the department of finance in West Australia First Time Homeowner Grants Western Australians building a home may be eligible for a Homeowner Grant of up to $10,000. So it may pay a young, growing family to consider building rather than buy.
The Decline in Existing Western Australia Home Values
It’s no secret that Australia as a whole has gone through a slump in home values. In Perth for example, average home values began to go down in 2014 sharply, and have dropped nearly 15 per cent in the following years. Therefore, there has never been a better time to consider buying an existing home.
With existing lot prices in Western Australia rising at a rate of around 10 per cent per year, the cost/value ratio of building a new home compared to purchasing an existing house must be taken into account, which is another reason why many people, even if they plan on doing major renovations, will choose to purchase an existing home.
Typical Home Renovations
There are many renovations a homeowner can consider. Renovating bedrooms, having modern windows installed, connecting a kitchen with a sunroom, or even the building of a “transportable home” within the home for an elderly grandmother or relative are often done, but the two most frequent renovations are kitchen and bathroom remodelling.
Outside of redoing the driveway, repainting the house and perhaps installing a new garage door for greater curb appeal, no renovation can provide you with a bigger bang for your buck than a kitchen remodel.
Many existing homes in Western Australia were built in the 1950s or 1960s, and just automobiles have transformed over the years to where they couldn’t even be envisioned 50 years ago, so to kitchens have undergone unbelievably dramatic transitions over the years.
A 1960’s kitchen may have had one stove with four burners, white walls with white cabinets, and cheap and not overly attractive benchtops. Today’s ultra-sleek kitchens may feature granite or quartz countertops or even polished concrete, walnut or oak cabinets, often stained a dark colour, separate convection, and electric ovens, and sophisticated functional yet decorative copper oven vents, and painted ceilings and even floors. Also trendy are natural stone kitchen tables.
In 2019, vanities, like kitchen countertops, are often made of natural stone. These vanities often provide a contrast to distinctly shaped, free-standing bathtubs, contemporary and sleek looking faucets with no-touch start and finish features, artistic lighting, often accented by natural light windows, and sophisticated showers.
So Many Choices, How Do I Choose?
The volume of choices in both its kitchen and bathroom restorations can be overwhelming.
To make it a bit easier, they have qualified professional designers on staff to work with you and to narrow down your choices, but in terms of beauty and terms of cost.
It’s also no secret that in recent times it has become harder to get a home loan in Australia.
Perth Renovations Co works with a number of finance companies. There are a number of variable and fixed-rate loans, including construction loans for new homes, as well as line-of-credit home loans.
Owners of existing properties may realize that their existing equity in a home is precious, and if you want to refinance a kitchen, bathroom, or make general improvements on your property, these line-of-credit home loans are an easy way to finance your restoration project.
Opportunities in Real Estate
Whether you are an investor or want an updated living space, savvy people in West Australia realize that with the swings in real estate prices, there is a risk, but also the potential for a substantial reward.
Investigate your options carefully and speak with reputable advisers from associated professions.
After careful planning; for many reasons, it is best to act now rather than wait for the future.