Move or renovate are pretty much the only choices when faced with a much-loved home that has become too small for your needs. If ever it comes to an add-on or trade-up, it’s always the same hard call, one which means staying or leaving your familiar comfort zone.
Does one stay and face builders and refurbishment or simply walk away. Emotions run high at a time like this and will definitely affect your decision-making, so plan well and here are some expert suggestions to follow.
Since most people have never experienced selling and buying at the same time or lived through a renovation, they also have no idea how stressful these two experiences can be.
What can you afford?
First check the equity status of your home. If you have, how much is there and would you need the funds for renovation or a new home purchase?
The reason is, making use of these funds provides mortgage tax benefits for the interest. But first you need a home equity line of credit.
If you decide on a new home, you will still need to be pre-approved. When you have the go-ahead, calculate the cost of a new home in the area you are looking at and be realistic about its size and fit.
On the flip side, if you plan to stay and renovate, speak to an architect and from them, you will get a more accurate idea of what your renovation entails. Then get a certified building contractor and compare costs from both.
Zoning; first see if you can and then how big you can, and after that, in what direction you can go.
Keep in mind, city laws only allow a given amount of development on any lot, so this obviously will be your guideline.
Check building codes
Building codes are next, after you know if you are zoned for what you are planning. Building codes will tell you things like how high you can go or different you can be or such interesting things, like will the sewerage system be allowed.
Do your homework and be fully satisfied with your research results.
Streamline your requirements
Prioritize your alterations and lay them out so you can get a better view of things. Look through the architect’s preliminary drawings and play with where your bath, stove or bedroom furniture is going to fit best into your designated space.
How to double your stress
If you have decided to go for selling the old and buying the new home, then be prepared to double your stress. If it was hard on you when you first bought your home then this is going to be twice as hard. Now you are facing the stress and complications of buying and selling at the same time.
You now have to carry two mortgages, while perhaps getting a bridge loan or waiting for your home to sell. No matter which way it is, you still have two properties to juggle while you wait.
For a renovation it’s no walk in the park either, this is where you will have to weigh up the pro’s and con’s. Renovation is a hard call as it also carries its own bag of problems in the old stress department.
If you are comfortable living with dust, noise, debris and a fair amount of chaos all around you, you will be fine. And if your additions can be separated from your immediate surroundings, it can be fun to see your dream grow right in front of you, just the way you planned it. Plus, on your evening walks, you can enjoy your own creation coming to life.
But first, let’s not get lost here, we need more clarity.
Presuming you have read the part above on ‘What can you afford?’ then you have some good idea of cost. But before you decide, consider some other outlays you my not have reckoned on.
Selling your home will bring on real estate commissions and transfer tax with further taxes on any gains. If you get a mortgage loan, keep in mind title and loan fees up front.
Count on the fact that none of these fees are refundable and can come to as much (or more) than $10,000 out of pocket, so plan carefully and enjoy good results.