Renovate or Build New: Which Home Is Right For Me?

If you are a homeowner and your current living space isn’t quite working anymore, you're probably asking yourself: should we renovate our existing home to suit our changing needs, or build a brand new home?

At William Ryan Homes, we believe that building new is almost always the right answer, but we also know that there are times when a renovation is a family's better option. In this article, we'll discuss the pros and cons of each and how to know you’re ready to buy. In the end, if you decide that building new in 2022 is right for you, then connect with us; we'd be honored to be your home builder!

Building New

A new home looks great and works perfectly, but it's got even more going for it than meets the eye.

PROS

●    All-New Everything. Especially what’s in the walls — insulation, wiring, plumbing, and systems.

●    Up to Code. Everything will meet or exceed existing building codes — no retrofitting involved.

●    More Control. You'll have more control over everything, from the design and layout to how it flows and functions.

●    Fixed Cost. Once your selections are made, there's no risk of going over budget.

●    Streamlined Process. Once your design plans are set, sit back and let us get to work.

●    Built-in Resale Value. New homes are built to appeal to a wider audience, so yours will be easier to sell years from now.

CONS

●    More Expensive. A new build can sometimes seem more expensive than a gut renovation. But in reality, when you build new, you decide up front exactly what your costs are, and that doesn’t always mean more money.

●    Longer Timeframe. Another misconception. Most of the time, the renovation will take longer than anticipated. (Ask anyone who has done one!) 

Renovating

If you're in a neighborhood that you love or prefer to stay in (for the school district or to be close to family, for example), renovating your existing home may be the best choice. Our best advice: Plan meticulously; prepare for the unexpected; budget more than you think you’ll need since renovation projects are notoriously unpredictable. But there are a few pros, too.

PROS

●    Adds Value to Your Home. If done properly, a renovation can add value to your existing home. But you have to be careful not to spend more than the max value of your home.

●    Perceived Shorter Timeframe. Small renovations can be done in a short timeframe, but gutting and rebuilding usually takes much longer than anyone anticipates.

●    No Moving. Staying in the neighborhood means no relocation upheaval.

CONS

●    Unpredictability. You can never be sure what you'll run into once you start tearing down walls and ripping up floors.

●    Less Control. There are more design restrictions because you're bound by the size and structure of your existing house.

●    Costlier Than Expected. The older the building, the more expensive it is to renovate because you'll need to bring everything up to code. There may even be mitigation work required if there is lead paint or asbestos involved.

●    Going Over Budget. According to the 2020 U.S. Houzz & Home Study: Renovation Trends, one-third of renovations go over budget.

●    Inconvenience. You may need to move out of your home or lose the use of an important room (such as the bathroom or kitchen) for a time.

●    Overwhelming. If you, the homeowner, assume the role of Project Manager and are managing the process and contractors, it can get overwhelming very quickly.

●    No Added Value. A renovation may not always translate to increased home value, especially if the design is too personal or the use is too niche.

Are you ready to buy?

No matter if you decide you want to buy a new home or even buy an existing one and renovate it, you need to consider your financial situation. here are several ways of ascertaining this, by reviewing your job status, your overall stability, and of course, your financial situation. 

How do you know if you are in the right situation to buy a new home?

 ●    You have a good credit rating that will enable you to get the best rate possible. A great credit score is at least 750. The National Association of Realtors offers insight into how your credit score is calculated.

●    You have enough money for the down payment. While you don’t necessarily need a 20% down payment to buy a home, the more you can put down on the purchase, the lower your monthly mortgage payment will be. Remember: As the price of a home goes up, the amount required for a down payment increases as well. (Another reason not to wait!)

●    You have job security. Make sure you can keep your income flowing to cover a monthly mortgage payment. (A home is a long-term investment!)

●    You can afford to take care of a home. Purchasing a home is just the beginning of the total cost of ownership. Repairs, replacing systems, and any other renovations should be factored into your budget. It’s a no-win situation to put all your money into buying a home and then find that you can’t afford to take care of it! This is a big reason that people choose a new construction home that doesn’t have those maintenance costs.

At the end of the day, you'll make the decision that's best for you and your family. And if that decision is to build a new home in Madison, WI, Milwaukee, WI, Tampa, FL, Chicago, IL, or Phoenix, AZ, that fits your unique lifestyle, William Ryan Homes is ready to help! Contact us to learn more about our building process and personalized features.