Home renovations have been a growing trend for Canadian homeowners, considering the transaction costs involved in selling and re-buying real estate!
Motivations for home renovations vary: homeowners consider renovations for lifestyle reasons. This might involve building a second level on the house to increase the number of rooms.
Home renovation are also considered for a retrofit project. Older wartime houses may need updated mechanical systems to fit today’s standards. Maintenance and repair renovations are probably the most common home renovation projects homeowners tackle.
Maintenance and repair renovations protect your investment and involve projects such as hiring a contractor to install a new roof or new energy efficient windows to update property to today’s standards.
Investing your time by thoroughly planning out a step by step process will pay you dividends through your project.
STEP 1 Set your priorities
STEP 2 Know what’s possible. Investigate the practicality of the scope of your project.
STEP 3 Do the math. Understand the costs, potential roadblocks, time to complete. Make sure you organize your financing so you have the funds for the project.
STEP 4 Pick your partners. Research your contractors and trades. Know who you are dealing with and minimize any surprises.
Step 5 Get it in writing. All contracts and estimates should be thoroughly documented.
STEP 6 Don’t worry about the mess
STEP 7 Inspect as you go.
STEP 8 Give the Thumbs Up! Good luck with your project.
Consider a Purchase Plus Improvements – the method is quite simple.
A Contractor comes into the new home with you to discuss the improvements with you and then they provide you a written quote for the work you want to have done.
That quote can then be added to the purchase price and after you take possession, the Contractor will complete the work. There is usually a time limit on the renovations – typically 90 days.
The funds for the improvement are held in a Trust Account with your Lawyer – the Lawyer holds these funds until the quoted work is completed.
Once the work and completion inspection are complete, the Lender will instruct your Lawyer to release the funds they held back.
Co-written with the team from Your Mortgage Advantage – Susan Ashton, Rena St. Clair and Jeff McGinn