There are a few good reasons to renovate your current home.  The most common is for your own personal enjoyment and that’s a great reason.  But some people want to renovate with a future sale in mind. Even if the primary reason is personal enjoyment, it doesn’t hurt to understand how your renovations will impact a future sale, and where you get the best bang for your buck.

First of all, if you have the room to add square footage, according to a study conducted by the National Association of Realtors, you get an increase in value of approximately 30% for every 1000 square feet you add to the average sized home.  Keeping that figure in mind, if your home is worth $1 million, and you add 1000 square feet, the addition should be less than $300,000 to increase your equity in the home.

The best renovation for return on investment is a bathroom.  Bathroom styling, although based on 3-4 main fixtures, changes considerably within a relatively short period of time, and buyers don’t want to deal with a bathroom renovation on a house they just purchased.  If your bathroom is 10 years or older, maybe the time has come to consider a renovation if you are looking to get the highest value for your home.

Another big draw these days is a “special use” room.  This can be a craft room or a hobby room or perhaps a theatre room.  If you have the space, and you might enjoy it until you sell, this is generally a good addition/investment to make to your home.

Just be mindful that you do not generally want to price your house out of the neighbourhood.  In other words, don’t become the most expensive house on the block. It can be hard to get that top dollar out of your house if the neighbourhood does not support it.

If you are looking to invest in a home renovation, and need to take some equity out of your home to do so, please contact me for mortgage advice. We can work with you to best get access to your equity, whether refinancing, switching lenders, or looking at alternate arrangements to fund your dream renovations.