The fact is, for the cost of a used home, you could get a new home. On a cost-per-square-foot base, renovation is often far more expensive than new construction. But the decision to do one compared to the other must not be dependant on construction costs alone. There are various areas to consider.
So why is constructing a new home much less expensive than a whole home remodel? That’s an easy answer – because constructing a home from the ground-up, you start with a clean slate to construct on. You gain huge efficiencies in scheduling simply because every little thing can be arranged beforehand. First the foundation is dug and poured. Then the walls are framed. Sheathing, windows, doors, roofing, siding and then the plumbing and wiring is installed. Insulation is next and then the wall studs are enclosed in sheetrock, etc.
In contrast, when a whole home remodeling project is carried out, the constructor is forced to work in an existing structure. Walls must be taken out before they can be rebuilt. If window and door locations will be changed, the old openings have to be closed up on the outside and interior, and then new opening cut into the walls. Work teams from the numerous trades frequently work nearly on top of one another. Existing home problems (for instance cracks in plaster or drywall) may force the builder to make compromises to connect the old and new portions of the property together. Making an open concept design change means getting rid of walls. And the challenge there is that you don’t actually know what’s within that wall. With remodeling you can normally count on surprises and all surprises cost more money.
While whole house remodeling is almost always higher in price than new construction, the cost of a home is just part of the equation.
When should you renovate versus looking to build new?
- You love your neighborhood.
- There aren’t any readily available building lots in your community. Check out home building for advice on finding a building plot
- You have an emotive attachment to your house and have the money to make the changes.
- You want to invest money in the home than in closing and moving costs.
- Property values in your community are increasing.
- Your home value is not at the peak for the community.
- You’re looking to buy in a mature neighborhood with grown trees and landscaping.
When should you think about the option of building a new property?
- Building lots are available in your area or a location you really like.
- The cost of redesigning your home will outpace its resale value.
- You want a home with changes that can’t be added to your present home.
But don’t think you’re getting off easy by building a new home; it is still plenty of work. And the construction of your house is not the only costs you’ll bear. When budgeting, you’ll have to include non-construction fees including architect, financing, settlement costs and relocating costs.
Remodeling and building are both viable options. Speak with a professional estage agent before you make your final decision. If you’ve read this far then you may find the video below worthwhile watching, its a video by David Siddons, a real estate broker, whilst he and the topic of conversation is clearly American the arguments for both sides are as relevant to the UK market as they are the American: