Deciding whether to renovate, sell, or knockdown and rebuild can be very challenging. Here’s how you choose …
On the podcast, I’m answering questions from the UA Community.
When it comes to our homes, we’re usually talking big money, sometimes big debt, decisions that can last years, and have big ramifications on our lifestyle, our financial health and our emotional and mental well-being.
So, let me share Laura’s question, and then I’ll take you through the way I look at resolving these types of dilemmas … and I share some experience from my own personal projects and decision-making here too.
“Hi, Amelia. My name is Laura. I live in Perth in Western Australia. Firstly, I just want to say thanks so much for your podcast. I’ve gotten a heap of great information and ideas from it. I guess we’ve got a bit of a situation where we would really love your advice or just thoughts on best ways to move forward.
We bought our house six years ago in Perth, right before the market crashed. We bought in a high point, it’s since crashed, hence we have no equity in our home. We also bought our home sight unseen, which sounds crazy, but it was actually built by my husband’s Pop (grandfather) in 1949. We always used to drive past the outside and we kind of thought how bad can it be inside. Well, let’s just say it needs a lot of love, attention, and money spent on it.
We’re at the point now, after getting married, having our children, where we would like to do some updates to the house. It really needs work. It’s full of asbestos, it’s tiny, lots of things going on. The first thing we actually wanted to do was pop in a new kitchen. So I recently did your Kitchen Design Challenge, which was awesome. However, just to get our room to the point where we can put in a new kitchen, the quotes I was getting … I was just blown away. I just thought “this is the start of a very long and difficult process”.
So we’re just sort of weighing it all up. Considering we don’t have equity in the home, do we just do these renovations tiny bit-by-bit? It’s honestly, I know how much work and money it’s going to take. I’m pretty realistic about that. However, we do love our home. We love our block, we love our suburb.
There is the option to actually build, because we have a wide frontage, (so we could) build new next to our existing house and then knock down. However, we are in a bushfire-prone area as well, so those costs need to be taken into consideration and I feel we would actually overcapitalise a little bit. I’m not sure, but all I know is that would be quite a few years away, to be able to do that.
Option number three is what my husband is sort of pushing for, and that’s to actually just sell and cut our losses. In doing that though, we would have to move back in with his parents, which is fine, they’re amazing. But obviously we’re in our 30’s, we have three kids. It’s not really the ideal situation, but we would have to do that in order to save for a deposit for a new home because I feel we would probably actually take a loss on this home just considering how the market’s gone.
So those are our three options at the moment. I have gone round in circles so many times about what the best course of action for our family would be. I know that you can’t answer that for us, but I would just really appreciate your thoughts on this and any advice you might have for us. Thanks, Amelia. Bye.”
LISTEN TO MY ANSWER NOW.
RESOURCES MENTIONED IN THIS PODCAST:
Renovate? Or knock-down and rebuild? This podcast episode gives you my key deciding factors >>> READ HERE
How to buy a renovator (plus free downloadable checklist) >>> READ HERE
I share Veronica Morgan’s top 10 tips when buying a property >>> READ HERE
When is the best time to sell your home? My tips here >>> READ HERE