We weigh up the key issues in the decision to build versus renovate.
In the build versus renovate debate, it's important to consider the complete picture.
Which option suits your budget?
Before asking builders for quotes on a renovation (be sure to get at least three separate quotes) set aside a day to check out some project homes. This will give you a reasonable benchmark on the cost of building a new home. As a guide, newly built homes are generally priced from under $200,000 though this can hinge on factors like the location, accessibility and slope of your land.
For the cost of a new build you could probably complete a very nice renovation of your existing home. However the older the building, the more likely it is that hidden nasties could bump up the final bill. This can be the result of anything from dodgy wiring to uneven floor levels or even termite damage, which may not be obvious until work gets underway. That's why it can pay to allow a little extra in your renovation budget for unexpected costs.
By contrast, building gives you the option of taking out a fixed price contract that provides greater certainty over the end bill.
Are you prepared to move out?
It may be possible to remain in your home while a renovation is underway. Sure, it's not always ideal and it can be disruptive. But it does mean saving on alternative accommodation like a rental home (or facing the inconvenience of couch surfing). And by remaining on site you should be able to oversee the builder's work on a daily basis.
On the flipside, if you choose to build rather than renovate, it's important to include the cost of accommodation – plus demolition and rubbish removal on your old home. Don't forget you could also face two sets of removal fees when you shift your belongings out of, and back into, your home.
Which will achieve your goals – building or renovating?
What are the key drivers behind your project? Maybe you're hoping to bring open plan space and light to an older home? Or you may be planning to add a second storey to provide additional bedrooms?
Either way it is critical to arrange a building inspection before making a final decision on building versus renovating to ensure your home is structurally sound enough to cope with a major renovation.
In some cases it can simply be cheaper to knock down the building and start from scratch.
Cut through the red tape
If you have a character home, check with your local council to see if any heritage restrictions apply. These could significantly restrict your renovation plans.
Equally, if you are planning to build, be sure that any plans you have comply with local government regulations.
Don't overlook finance issues
No matter whether you choose to build or renovate, the way you will fund the project is central to a good result.
Your local Mortgage Choice broker can provide tailored, expert advice on the range of funding choices available. That makes an obligation-free meeting with your Mortgage Choice home loan expert a sensible first port of call.