Let’s face it: housing supply is limited right now. Even if you wanted to move on to bigger, greener pastures, you might have a hard time finding the right property — at least at a price you can afford.
Fortunately, picking up and moving on isn’t the only option if you’ve grown tired of your current abode. In fact, in today’s inventory-strapped market, your best bet may be staying put — and renovating your existing home instead.
Why Renovate Instead of Buy
In today’s competitive market, the benefits of renovation are three-fold:
- You get to upgrade and improve the home exactly to your liking
- Your renovations will hopefully add value to your home (meaning potentially more cash when you sell)
- Your renovations will likely cost a fraction of what a new home would – especially in the long run
The key to number three is financing your renovation properly. As a homeowner, you have several routes you could take to pay if you choose to renovate instead of buy. You can:
- Pay in cash – Did you have a bunch saved up for your potential new down payment? Stay put and use those funds toward renovating your home, and get the exact features you’re looking for without all the hassle of moving. A quick note of warning, though: You never want to use all your savings, no matter how much of a slam-dunk you think a project may be. A rainy day fund is vital for homeowners. You never know when something might need repairing or replacing!
- Get a cash-out refinance – Do you already have a good amount of equity in your home? A cash-out refinance can help you tap that equity and turn it into cold, hard cash. Use that cash toward all the home projects you want (or even a vacation while your reno team gets to work).
- Secure a renovation loan – These are loans specifically designed for home renovations and can help you pay for everything from replacing your HVAC system to re-painting your siding. There are lots of options for renovation loans, so make sure you talk to a loan officer about which one is right for you.
If you’re not seeing much affordable real estate out there, renovating your existing home can be a great alternative. Contact an Embrace loan officer today to learn more about the options you have for upgrading your property. We’ll guide the way.