Downsizing to a smaller home more suited to your needs may be one solution, but if you like living in a particular neighbourhood, and are strongly attached to your current home, renovating may be a good option.
*Photo Credit: hawaiirenovation.staradvertiser.com
Creative changes to your existing property, without extending it, could increase your quality of life for many years to come. For example, creating an en-suite, updating a kitchen or turning an unused bedroom into a well-equipped hobby studio might be possible.
In particular consider changes that will enhance your comfort and safety, as you get older. Whilst we don’t like to think too much about getting older, if you plan your renovation carefully you may make it possible to stay in your home much longer.
Renovating can be expensive, so make sure your renovation adds value. Popular renovations that almost always add value include kitchen and bathroom makeovers. However, opting for wall-to-wall marble and gold plated taps is a sure way to overcapitalise, so aim for clean lines and understated fittings rather than over the top extras.
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When it comes to refinancing, recent statistics from Mortgage Choice in November 2014 showed construction loans accounted for almost 7 per cent of all loans written. Construction loans have, on average, consistently accounted for anywhere between 5 and ten per cent of Mortgage Choice’s business.
Generally it’s not just the major banks willing to lend to renovation projects. Most lenders can now offer construction loans too. A borrower’s eligibility for a construction loan is evaluated in much the same way as it is for a standard home loan. In order to obtain finance, you will need to show proof of income as well as evidence of genuine savings.
In addition, if you are planning to completely rebuild, you may need to provide your chosen lender with a copy of your property plans who will hand them over to a valuer who can then establish how much the completed property would be worth, thus determining how much you may be able to borrow.
Rather than be restricted in your access to funding, renovators and builders are spoilt for choice with various options available. Be sure to fully cost all of the available options to determine which loan is best for you.
*Photo credit: www.sunriseseniorliving.com
A recent Perth Now article showed that PERTH homebuyers love their “renos”. WA home renovations have increased 147 per cent since 2010 and renovation spend is at its highest level since early 2012, a new report has found. Against the backdrop of rising house prices the total value of renovations in WA for the past 12 months ending in August was $579 million, according to the new data released by Westpac. The average renovation spend in WA was $33,365.
The Mount Lawley-Inglewood area was revealed to be WA’s most renovated location, followed by the Wembley-West Leederville-Glendalough and the South Perth-Kensington areas.
Westpac general manager of retail banking Gai McGrath said the increase of renovations had been boosted by rising house prices as homeowners have opted to renovate rather than move.
“In Mount Lawley, for example, house prices have risen by 23 per cent over the past five years. Existing homeowners who may once have looked to upgrade into a new home are choosing instead to renovate, adding desired rooms, features and cosmetic changes,” Ms McGrath said.
“This can be a smart investment strategy as you are avoiding the costs associated with upgrading to a new home, like moving services and stamp duty.”