Should I stay or should I go?
As this COVID19 Lockdown and social isolation situation has made us spend so much more time inside our homes, no doubt this has precipitated many of us reconsidering our current housing.
Locked down, in such constant proximity to partners and children, intensifying the work-home-school-life-balance juggle, may have some of us longing for a little more space.
Whether we think we need an extension for a dedicated home office or recreation space, crave a full wing for a parent’s retreat, or if our apartment is suddenly much too small; how do we know what we really need?
Our Director, Len Powe, discusses some thoughts to help us decide what we really need: should we stay and renovate or extend? Should we move to a larger home? In the words of The Clash, Should I stay, or should I go…?
We start with the reality that you will likely live in a minimum of three different residential dwelling types during your lives.
- The one when you build a relationship and grow into a young family (fur kids count as family too!)
- The one where you bring up your school age/teenage/student children, where you all need separation and privacy (the home you may be dreaming of during lockdown!) and
- The empty nest one. This one is either your second home, remodelled to allow your children (and their families) to visit and stay (they may live interstate or overseas) or alternatively, you “downsize”.
Before you start on the uncertain experience of undertaking (any) building project, consider the following:
- What is a reasonable budget? How much can you borrow and/or afford to spend, particularly if interest rates increase significantly?
- What do you need to include in that budget? Rental costs (read on below), new furniture, window coverings, floor coverings, appliances?
- Is there anything you are prepared to do yourself or separately? “Painting” is the first idea everyone has when trying to save money, but be careful and think it through.
- What is the current value of your property and how much would you have to spend if you added this selling price to your extension budget?
- Are there properties in the area you could purchase for this combined amount and still achieve a similar outcome without the pain of the extension?
- Should you just look for another property and build your “dream” home to your brief and without compromising?
Some of the advantages and disadvantages of these different scenarios can be summarised as follows:
Undertaking an extension or renovation
- You will not be able to live in the house while the construction work is being undertaken, for obvious reasons such as noise, dust, safety and insurance.
- Therefore, you will have the cost of moving and renting during construction (remembering, it always takes longer than you think). A side note; moving house is regarded as one of the top 3 most stressful things you can do.
- You have a likely timeframe of 7-10 years to enjoy the benefits of the improvements and to realise your costs in value appreciation.
- You will avoid selling agents fees, removalists costs and stamp duty. This money can then supplement the budget for the home improvements.
- You have the advantage of already knowing whether you can tolerate your neighbours.
Selling now and buying an upgrade in the same area
- Avoids the stress and inconvenience of the construction work. This advantage is not to be underestimated. (“It’s all too hard. I just want to move to a bigger house and let someone else do the renovation.”)
- Change is generally good.
- You will incur relocation costs (including agents fees, removalists costs and stamp duty).
- Typically, there is always something that still needs to be done to make it what you want.
- You can’t choose or change neighbours.
- You (generally) get what you want in the design of the home without compromising or buying someone else’s problems.
- You need to be patient. It can be difficult to find good vacant sites or “knockdowns” with the ideal location, aspect, orientation, noise, proximity to transport and amenities.
- There is the challenge of lots of decisions and selections to make (this can also be fun if you are properly advised).
- Everything is new when you move in.
- This option will take the longest time to complete as a project.
- This is also likely the most expensive option but, if you plan to stay for 15-20 years and make this your family home, a great alternative.
- This asset option is the most likely to appreciate in value the most.
- You still can’t choose or change neighbours.
No doubt there’s some food for thought here, to promote some robust discussion for those who have been longing for a little more space during the current lockdown.
What do you think? If you’ve had to approach this decision before, we’re interested to hear how you approached the decision and key factors that helped you make the decision. Did you stay or did you go?