Renovate, Rebuild or Relocate: How to decide what's right for you

It’s a terrible quandary. Your home doesn’t have enough room for a growing family or no longer suits your lifestyle but would you be better off renovating, rebuilding or relocating completely?

The only thing that’s clear is that it’s a huge decision, and every aspect has to be considered carefully before you make the choice.

“Each option suits people in different circumstances and tends to come with its own Pandora’s box,” says senior property strategist and valuer Belinda Botzolis of Metropole Property.

“And you have to be quite clear about the implications before you start to open one.”

Renovate

We’re currently in a pandemic of renovations, with $11.82 billion worth of approvals granted around Australia over the 12 months to October 2021, and experts predict the boom is likely to continue throughout 2022.

The real advantages are that, depending on the scale of the work, renovating does tend to be less disruptive than the alternatives. You can also stay in the area, with the same neighbours and the kids at their current schools, and you won’t have to pay stamp duty.

“The greatest reward is that, at the end of the process, you’ll have a home that is customised to your own needs, lifestyle, taste and even colour preferences,” says Werine Erasmus of The Happy Renovator. “You’ll also have a massive feeling of achievement.

“But it’s only the best option if someone has a lot of energy, time and patience to cope with all the stress and the shortages of building materials and tradespeople, rising prices and all the inconvenience. I often tell friends who ask that they’d be better off relocating.”

Dollar for dollar, a renovation per square metre can be more expensive than a rebuild, too, says Ms Botzolis. It can also involve dealing with a huge amount of red tape, trying to build up into an attic space or extend out, or expense in having to keep heritage features or trees in the garden.

Rebuild

The difficulties with a rebuild can be similar to those with a major renovation, but on a bigger scale.

“There may be easement covenants in place that no one realised before,” says Ms Botzolis. “There are also now new regulations that might mean you have to pull back from storm drains, soundproof your house more when under a flight path or build to higher standards in a bushfire, or flood, zone.”

Finding lead in the soil or coming across asbestos when you’re knocking down your old home can both prove catastrophic. Then you also have to pay rent for the time before your new home is ready.

“But if you moved, you’d have to pay, say, five per cent of the value of the property in stamp duty, say, $50,000 on a million-dollar home, or $100,000 on one that costs $2 million,” says Vicki Laing of Laing Real Estate. “Why not put that instead to the cost of a rebuild or renovation?”

The emotional cost can be heavy, however. “I’m in the middle of a knockdown and rebuild and there have been a lot of COVID cost problems and nothing being delivered on time,” says Hamish Kyle of Raine & Horne Neutral Bay.

On the plus side, you end up with a brand-new home. “Everything is new and you’ll have a warranty for defects for six years,” says Bill McDonald, founder of McDonald Jones homes. “It’ll be maintenance-free with no nasty surprises like old electrical wiring that you missed in a renovation.

“As well, you’ll be able to stay in your favourite neighbourhood and have all the latest technology like a fingerprint opening the front door and Wi-Fi in every room.”

Relocate

Yes, there’s the impost of stamp duty, agents’ fees and removalist costs, but then there’s the lure of a new start in a home that will (hopefully) suit you and your needs, with far fewer surprises than can be revealed in a renovation.

Moving further out will also tend to give you a bigger block and more space for a similar price. “I had someone who bought a six-bedroom house in Gerringong for the same price as their two-bedroom apartment in Cremorne,” says Kyle.

Many people, with the pandemic, have sold homes close to the city and are buying on the coast or in the regions, to improve their lifestyle, too. “All that space and fresh air really suits a lot of people,” says Laing. “They can be very happy with the change.”