Twelve months on from our last examination of renovation activity, the reasons owners choose to improve rather than move remain largely unchanged. The market in which they are making that decision however is not. Cost of living pressures, the highest interest rates since late 2011 and a marked shift in the availability of trades have combined to reshape both the appeal of renovating and the practicalities of getting the work done.
The cost of moving and the desire to reduce debt are keeping owners in place and once that decision is made, the renovation conversation tends to follow quickly. The transactional costs of a sale and purchase are substantial and in an environment where many households are actively working to reduce debt rather than take on more, the case for staying put is compelling. Less easily quantified, but no less influential, are the reasons owners give when asked why they are reluctant to leave a particular street: a good location, friendly neighbours, proximity to the children’s schools and a favourite cafe nearby.
It is the calculation I have made myself. An extension delivers the floor plan, kitchen and bathroom features we want without the expense of finding another house and then updating it in any case, and it does so in a location and a dwelling that are already known quantities. That final point should not be underestimated. Buying carries a degree of uncertainty that renovating an existing home simply does not.
Conditions on the supply side have improved considerably. The reduction in building approvals and construction commencements has freed up trade capacity and the market is behaving much as basic economics would predict. We are no longer seeing the twelve-month-plus waits for a builder to commence, nor the same difficulty engaging a trade for smaller-scale projects. Largely, the supply constraints on materials that characterised the past few years have resolved themselves. The offset is cost, with well-reported increases in the price of certain building products now being felt at quote stage.
The traditional renovation still dominates. Households extend to add a bedroom or a bathroom as the family grows, increasing the building footprint in the process. That segment may have slowed slightly, although other categories of work have held very consistently or lifted marginally. A new kitchen or bathroom remains the most typical project we see and the appeal is straightforward – making the dwelling more liveable and improving the way the household uses the home day to day. Alongside this sits a category of work aimed squarely at reducing household running costs, with the addition of solar panels the most common example as owners look to bring down the cost of running the home.
For those considering the leap, discipline around cost and documentation matters. Understand precisely what works are being undertaken through a solid building agreement, contract or quote, and where the meaning of a document is unclear, seek clarity or professional advice before signing. Equally important is staying engaged once work is underway. Be mindful of progress claims and the payments required and satisfy yourself that the works have genuinely been completed before releasing funds. The difficulties tend to emerge at handover, when incomplete works meet a builder who has already been paid for the project.
Renovating is not for everyone. It demands time, patience and a tolerance for disruption that not every household has. For those prepared for it, the rewards are real: a home configured the way you want it, delivered without the cost and uncertainty of a move and a level of house-pride that is difficult to replicate when the finished product is shown off to family and friends.