The Greater Toronto Area has seen unprecedented rises in prices of homes, condos, and property in the past years. Seemingly overnight, the average price of a home in the GTA has exceeded half a million dollars, according to Global News. As a result, homeowners are stuck in what been called a “housing gridlock” that has prevented moves and spurred a sudden growth in the interest in renovation.
Canadians Invest More in Renovations
In lieu of the events of the past few years, we’ve seen a steady increase in the rate that homeowners invest in home renovation. Recent 2019 polls suggested that 50% of Canadian homeowners intend to invest in home renovation. CIBC’s Survey states that: “Canadians are putting off the purchase of a new home in hopes that prices will come down.” This shift has also characterized a return to renovation as an investment in lifestyle and comfort, as opposed to an investment in your property value. With more and more people holding on to their homes for fear of not finding a reasonably priced property in the future, renovation is now a means of making the most out of the current situation. Consequently, lack of investment in renovation of new properties is leading to unreasonably priced homes in need of much attention on the market. Homeowners looking to buy may face the necessity of renovation upon purchasing a new home, despite wanting to avoid it.
2020 – So Is it The Time to Renovate?
As more homeowners invest in renovation, we find many customers asking us: is now the best time to renovate my home? We believe that the answer is yes. Homeowners are taking advantage of the housing market and the subsequent boom in renovation spending by pouring resources into home additions, renovations, improvements and remodels designed to give them a boost in the competition, raise the value of their home and provide them with comfort until the situation looks safer. Kimberly Greene of Which Mortgage states: “In tight housing markets, homeowners or landlords looking to sell or rent their units are competing with new builds, and renovating those spaces can give owners a leg up on the competition.”
After what has been a crazy couple of years, foreign investment shows no sign of stopping and resale value still seeing upward trend, it’s still a great time for profiting on home renovations in 2020. All of this means it’s still good news for homeowners looking to invest in renovation, and resale. Even for homeowners unwilling to navigate these treacherous waters, home improvement holds solace and much potential for upgrades.
Home Renovations with Value in 2020
However, not all renovations have value. In fact, only few have the potential to increase your home’s price significantly upon re-sale. So, unless your investment is for you and your home, we recommend sticking to expert advice when renovating. And without further ado, here is precisely that expert advice you’ve been looking for! Here are some of the home renovations worth investing in, in the upcoming season.
Tip 1: Define your goals.
If you’re looking to upgrade your home for the living space and functionality, you shouldn’t be worried about the potential sale. It’s important to clearly define the purpose of your renovation as resale, or living. This will allow you to communicate with your builder with ease, and define your needs in a better way.
Tip 2: Add value and function.
While you may be looking for resale value, remember that unless you’re selling your home to the highest echelon of society, you probably don’t need to include anything extravagant. Some of the best cost-for-value renovations are among the simplest. Instead of installing a skylight, think of what people in your neighbourhood are looking for when buying a home, and consider renovations such as:
An unexciting upgrade, but one of the most useful and cost-beneficial you can make. According to reports from local listings, homes with fiberglass insulation not only see a huge difference in home heating and cooling bills, but are also sold for signifigantly higher. In fact, the expected return on investment according to real estate specialists is up to 107%. From an investors viewpoint, this unglamorous investment is one of the best.
Front door replacement
Nothing has as much capacity to raise your home’s curb appeal as a new front door. Style experts agree that a new front door is one of the most welcome real estate investments, and generally offer you up to 90% return on investment. Some of the most popular replacement models are insulated, or made of sensible steel. Modern, lively looking doorways have the potential to alter your home’s exterior style, and create a more unique and welcoming look.
Older homes with older windows lack the energy efficiency needed to thrive in the current market. As a rule, windows should be repaired or replaced every fifteen years, and as new insulated models appear on the market we see more and more homeowners opting for energy-efficient, double paned types for the decrease in home energy bills and increased longevity. For these reasons, new windows are not only a good investment for resale value, but also current homeowners looking to reduce monthly costs.
Depending on your home’s style, upgrading your hardwood flooring from carpets or laminate can be an excellent business decision. Solid wood hardwood is universally appealing, and sought out by homeowners no matter where you live. Oak and ash are favourites among homebuyers, and muted finishes have been in style for the past few years.
These renovation ideas offer more return on investment than a typical kitchen remodel, and are generally what individuals looking to re-sell their homes invest in most often. While remodeling your bathroom or kitchen also offers higher re-sale, it is also an investment that can be labour intensive and much more expensive in the long run. For that reason, experts suggest that unless you intend to stay put, it’s not worth the time or expense. However, it couldn’t be a better time for renovations intended to improve your home’s comfort.
Take a look at our other posts about renovations for more ideas about additions, remodels and upgrades meant for living comfort.
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Many homeowners today choose to invest in a home addition to expand their space, over looking for a home with more bedrooms. A home addition provides you with the necessary space to live more comfortably while preventing you from spending your resources and time on planning a move, and worrying about the market. Home renovations and upgrades such as bathroom reno, home additions, kitchen renovation and especially full home renovations are simply the safer bet, and offer the most return on your investment.
So, whether you are a homeowner in need of an upgrade, or an investor looking to get the most out of your property, you are stuck with two options: sell for a moderate return on your investment, or renovate for a better return.