RENOVATE OR RELOCATE?

Navigating the Luxury Real Estate Market

As a realtor for the past 24 years in the vibrant city of Toronto, clients often consult with me while grappling with a common dilemma: should they invest in renovating their current home or opt to move into a newly renovated property? This decision is not often just about cost and convenience; it also reflects one's lifestyle preferences and future aspirations and sometimes frankly, cash. With my own experience in renovating and expertise in property sales, I can share the advantages and disadvantages of both options to help you make an informed decision.

Advantages of Renovating Your Home

1. Personalization: Renovating allows you to customize your home to your exact preferences and needs. Whether it's a chef's dream kitchen, specific home office needs, or a spa-like bathroom, the options are limitless.

2. Increased Property Value: Thoughtful and strategic renovations can significantly boost the value of your property, especially in Toronto's competitive real estate market. If you are smart about it and follow basic increasing value guidelines that I can help with, (hint, it's more detailed than a chef's kitchen and beautiful baths!) you can add more value than the dollar amount you invest in the renovation, while still getting your dream house.

3. Emotional Attachment: For those deeply connected to their current home or neighbourhood, renovations can rejuvenate the space without losing those sentimentalties or characteristics important to you.

Disadvantages of Renovating Your Home:

1. Unforeseen Costs, and Cash on Hand: Renovation often come with unexpected expenses and hidden costs, which can be a financial strain.. In addition, it is relatively uncommon to be able to finance a renovation. Generally speaking, renovations require cash and unless you are able to refinance at the end of the renovation, that cash will be tied up in your house until you decide to sell. Depending on your personal cash flow situation, this may have an impact on some of your other financial goals. For example, buying a renovated house for $1,500,000 with a 20% down payment may be more palatable from a cash flow perspective than buying and un-renovated house for $1,200,000 and putting $300,000 dollars more cash into it in improvements.

2. Time and Inconvenience: Living through a renovation can be disruptive and time-consuming. Delays are common, and the process can often be longer than anticipated.

3. Potential for a "Double Move": Depending on how extensive your Reno is, you may need to move out of your home and into a rental or a hotel for all or part of the duration of your Reno. This could potentially involve moving furniture into a storage unit as well. While that is something I can certainly help you with in terms of finding a short term furnished rental as well as storage companies that will take store and return your furniture, there is a hassle factor involved and again, may require additional spending.