Home Remodeling Versus Home Renovation

People who own their own homes may be thinking about making some changes to the place they live. When it comes to altering the home, there are two choices that people have, and that is home renovations, or home remodeling. Some people believe that the two words mean the exact same thing, there is a significant difference between renovating a home and remodeling it, and it may make it easier for people who own a home to decide whether or not they want to do either one.

The Differences between Remodeling and Renovating A Home

While it is easy to mistake the words remodel and renovate, the truth is that they do not mean the exact same thing. An example that will help homeowners differentiate between the two is to think of a round white frosted cake. Renovating the cake would be to take that cake and change the color of its icing, and perhaps, adding something to it like, candy decorations or big frosting roses. To remodel a round frosted cake, the knife used to frost, it would be used instead to do things like cut the cake and change it from round to square. Here are some other major differences between home renovating and home remodeling:

• The amount of time the work takes: With home renovations, people are just changing the aesthetics of the home, so doing any kind of work may only a few weeks up to a month or two because the world is all on the surface of the home itself. Home remodeling involves doing more in-depth work to a house, and the time can take many months to complete.

• The use of a professional: When it comes to just doing a few things to the appearance of a house, like adding paint, or adding wallpaper, homeowners do not need to consult a professional. However, with a major remodeling project, a professional architect is going to have to be consulted so homeowners do not take matters into their own hands and do something that could seriously damage the structure of their home. Without the help of someone who knows what they are doing when it comes to the structure of houses, a simple renovation project can turn into a major problem because they inadvertently damaged their homes.

• The value of the home itself: Though there are several differences between remodeling and renovating, there is one thing that they both have in common and that is what they do to the value of a home. Whether it is just adding paint or wallpaper, or doing something like adding another room, the price that a home is valued at is going to go up. If homeowners decide to sell their home for something else, than what changes they have made are only going to make that home more desirable to others, and they will sell it pretty quickly.

Change is something that is inevitable, and for people who own a home, the change can be on the surface or deeper. Home remodeling is when the structure of a home is changed, and home renovations are when cosmetic things like adding paint or putting up wallpaper. Though no matter what changes homeowners make, their house will get more valuable, and if they choose to sell it, it will more desirable and sell fast.

DIY Home Renovation Tips

Home renovation often increases property value. This is one of the most common reasons for renovations, in addition to updating a home and making it more suited to your personal tastes. When it comes to renovations, some homeowners opt to utilise the services of professional contractors. Renovation projects can be very costly, especially where you enlist the services of a professional builder, interior designer or other specialist. This is why some people prefer DIY (do it yourself) renovations, which can be more cost effective, especially where you have the skills to do some of the tasks. So if you are thinking of DIY home renovations, here is a list of renovation tips that may help you renovate your home.

Plan

Having a plan for each step of your renovation allows you to renovate in a more cost effective manner, giving you the ability to budget accordingly before you start the project; an outline of the project will help during the renovations.

Appropriating funds from your budget is extremely important. Kitchens and bathrooms are huge selling points in a house, which means you should spend the bulk of your time and resources renovating those rooms. Often a new coat of paint or new carpet can change the entire look of your bedroom and living rooms, and both are relatively inexpensive ways to improve a place.

If you are looking to increase the property value, talk to a realtor before you start your renovations. Your realtor can provide you with insight as to which renovations are worth the money and which ones will not turn a profit. Additionally, your realtor can provide you with current real estate trends so you can see what aspects of a house are selling points with buyers and which ones are not.

Improve instead of renovate

Before you start the project, think about what you want and decide whether or not you have to replace things or simply reface them. For example, if you are renovating your kitchen, ask yourself if you need all new cabinets or if painting or staining your current cabinets will provide your kitchen with the update you are looking for. In addition, you can remove the doors of your current cabinets and attach new ones for far less than the price of installing a complete cabinet system.

Cost

One of the biggest costs in renovating your house comes from materials. By purchasing and transporting materials on your own you can save hundreds of dollars. A contractor or other third party will charge you delivery fees among other hidden fees to pick up and deliver materials to your home. In addition, doing this yourself gives you the option of shopping around, comparing costs and finding items on sale or clearance.

The best way to reduce cost is to go to places and source second hand building material. If you can’t access used materials, then head to thrift stores or larger outdoor stores that sell cheaper items.

Design

Creating a design for your renovation is perhaps the most important aspect in the remodelling process. Use resources of the internet to get an idea of how you want to design things and speak to professionals to get expert advice and tips on how best to approach the renovation and how to work with the space that you have.

Extra help

Some renovations will inevitable require the use of a contractor. If you are not accustomed to working with plumbing or cabinetry, it is wise to invest in a contractor to handle those aspects of the renovation for you. The low cost of doing it yourself is gone, but not knowing what you are doing can cost you a significant amount of extra money in the long run! If you must go the route of hiring a contractor, you can still get things done cheaply by doing smaller tasks yourself. For example, if you hire a contractor to handle your new kitchen, you can paint the kitchen yourself, which will save you several hundred dollars.

Consider these tips!

Before you start your renovation project, consider these DIY home renovation tips. Each will save you time and money on your renovation. Adhering to them will help you increase the property value of your home and maximise your profits by allowing you to see a return on the money you spent remodelling, should you decide to sell your home.

Home Renovation – Increase Your Profit Using Value Engineering

The concept of value engineering in renovation has never been more essential than it is today. At the start of 2009 we can still hear all sort of commotion about slow economy and troubles in the real estate market. All this should awaken renovators who are planning to increase the value of their homes, that a small miss-calculation or an over-renovation could easily destroy their profit or worse result in a complete loss.

Let me be clear, slow economy and slow real estate market does not mean that you can not remodel your home to increase its value. What it means is that you need to know what to renovate and how much to renovate in order to turn a good profit. At first sight this may seem simple; however, there is more involved than a simple question from your local renovator. To fully maximize your profit you need to understand value engineering in regard to home renovation.

Simply put value engineering in respect to home renovation is the process by which you analyze to determine what renovations will bring in the most profit for your home. Here we are going to quickly discuss the steps that must be taken to determine how to maximize your profit.

1) The first step in this process is to determine the market value of your home as well as market value of renovated homes similar to your home in your area. This is done to find out whether there is any room to profit. If the price for your un-renovated home is close to the price of a renovated similar home nearby, renovation could be a waste of time and money.

Remember, the key words are “similar homes” and “in your area”. There is no point comparing your home that is built on a 20 x 100 parcel of land to a home built on a 5 acre land as you are not able to stretch the size of your land. Also the comparables that you choose must be near your home, preferably on the same street or just few homes down the road from your home. You can obtain market value of these renovated homes from your local real estate office or from a qualified appraiser.

2) The second step is to determine how much value each renovation adds to your home. This information can be obtained from your local real estate office or a qualified appraiser. Real estate salespersons and appraisers for most part use a process called CMA (comparable market analysis) to determine your home value. In short the appraiser looks at similar properties sold recently near your home.

Using his/her extensive database, the appraiser is able to adjust the price based on the condition of various areas of your home as well as any new additions. For example the database indicates that an additional second bathroom in your area increases home value by $8000, updated kitchen increase value by $6000, Second garage does not impact the value and etc. This is how your local real estate salesperson is able to price out your home.

3) The third step is to determine the cost for each renovation. Make sure to get price estimate from at least three qualified contractors

4) The final step is to analyze your findings in step 2 and step 3 to determine what renovation(s) will yield the most profit.

Easy Ways to Find Finance for Your Home Renovation

The burning question on the minds of many Australian homeowners is – will I “Renovate” or “Relocate”? So, if you are one of these home owners, you may have also realised that the high cost of purchasing a new home and selling your current home far outweighs the challenges of renovating your current home. However, you should only renovate if the renovations will:

>> Add value to your home

>> Result in an improved standard of living

>> Be used to perform emergency repairs or full home extensions

Do Lenders/Credit Providers impose Restrictions on the Type of Renovations?

Subject to their credit policies and lending guidelines, most lenders/credit providers will let you borrow the funds to improve the value of your home for any worthwhile purpose, such as if you need to:

>> Add another bedroom, or any other room

>> Renew/update your bathroom or kitchen

>> Add a pergola and outside recreational area

>> Install a swimming pool

>> Extend your garage from a single garage to a double

>> Construct a secondary dwelling on your existing property

>> Any other structural or non-structural construction

What Methods of Finance can I choose?

Here are some examples of the popular methods to ensure easy home renovation:

Home Equity Loan – This financing arrangement is perhaps the most common way for Australians to finance their home renovation projects. A home equity loan works where you borrow the money against the value of your home. To illustrate this I have provided the following example:

>> The example assumes your home is worth $700,000, and

>> Your mortgage loan is $300,000

From the example illustrated above, you will have $400,000 equity in your home, which you can use to fund your renovation project.

The recent rise in-house prices has resulted in many Australian homeowners having acquired considerable equity in their property, this can make getting a home renovation loan easier for these people and reduces their need to dig into their own cash reserves.

Personal Loan – This financing arrangement is a suitable option for you to consider if:

>> You do not have any equity available in your home, or

>> You only have to complete some minor renovations

By choosing a short-term personal loan, you will find that:

1. The personal loan interest rate is much higher than a home equity loan, and

2. You may be limited to the amount you can borrow (e.g. from $5,000 to $50,000)

Construction Loan – This financing arrangement is available for you to complete large-scale renovation projects that require council approval and the services of a licensed builder. The lender/credit provider will impose the following restrictions when they are considering a construction loan for home renovation:

>> The lender/credit provider will not fund the full loan amount upfront to you

>> The lender/credit provider will release the money to you only in stages as the renovation progresses

Can I afford to Re-build my Home if it was destroyed?

You should already have normal home and building insurance in place, but you need to increase your building insurance to cover the costs associated with your home renovation project. So, if you cannot afford to rebuild your home if it were destroyed by damage from fire, or from any other natural disasters, you should ask yourself the following questions:

>> Do you have building insurance?

>> If you have building insurance in place:

1. Is the amount of insurance cover adequate?

2. What does your building insurance plan cover?

3. Does your insurance plan include Total Replacement cover or Sum Insured cover?

Don’t Delay and Take Action Straight Away

So, if you are thinking of renovating your home without any stress, you should seek advice from a professionally qualified and expert home finance broker who is a specialist in home renovation loans and, has helped numerous home owners when they had considered renovating their property.

He/she can arrange finance for your renovation project. A loan broker will provide you with a wide range of finance options and products after creating a budget for you. But, remember that you should be clear about your future plans as it will help you in choosing the right finance option.

Now that you have read this article, I sincerely hope it will help you to understand the easy ways of renovating your home with a professionally qualified and specialised finance broker.

 

Tips for a Successful Home Renovation Project

Your home should not be just a place where you go to nap after a long day’s work. It should be your personal retreat. It should help you to unwind, relax and rejuvenate. If your home doesn’t make you feel comfortable, it is time to renovate it and make it desirable for you.

A home renovation project can be excruciating for homeowners. It is because they often forget to be cautious while making decisions. But, if you are practical and make the right choices, you will be successful in transforming your home into a comfortable living space.

Total Attention ensures Total Success

A home renovation project does not simply begin with a budget. It is important to make informed decisions because renovating a home is an expensive task. If you make a mistake, you will have to spend your savings on rework. So, it is better to be attentive during the entire process of the home renovation project.

  1. Before starting the Process

Fixing a leaking faucet may be a DIY job for you. But, not every home task can be a DIY job. For large-scale renovation, you will have to call the experts. When you are in the process of choosing a home renovation contractor, consider the following points:

· The Best is always Busy

When it comes to hiring a contractor, you must remember that a slow response is not a bad sign. Usually, the best contractors are busy and so they may require a few days to get back to you. It is important to have patience because hiring a wrong person can be a nightmare for you.

· Never do Business with a Buddy

It sounds amazing to have your best friend working with you. But, remember that renovating a home involves making several decisions. It may result in arguments between you and your buddy. Instead, you should focus on word-of-mouth. If you have received glowing recommendations of a contractor, visit his construction sites, talk to his customers and then, make an informed decision.

· You get what you Pay for

Experience is costly. So, expect an experienced contractor to charge you higher price than an unskilled one. You cannot imagine obtaining the same level of skills from the two contractors. So, make a wise choice after considering your budget.

  1. During the Process

You cannot relax even if you hire the best home renovation contractor in town. In order to get the best results, you have to ensure the following things:

· Do not go on vacation and leave the contractor alone. He may need you to make a few decisions.

· It is wise to visit the site regularly to ensure that everything is in order. It will help you to avoid rework in the future.

· If the renovation work affects more than half the area of your home and you are unable to use any of the bathrooms, you should pack your bags. So, make arrangements for your accommodation well in advance.

· There are high chances that your home renovation project may exceed the budget due to unforeseen circumstances. So, keep aside money for the same.

· The contractor may require a couple of days more for finishing the project. Be ready for it.

  1. After the Process

· Once the contractor informs you that his work is finished, inspect your home. If there is any incomplete work, ask him to finish it.

· You can hire a third-party inspector to do the inspection for you. An experienced inspector will be able to find problems that you may not be able to find.

· Do not forget to create a Punch List to provide detailed information regarding the pending work to the contractor. You must include all the incomplete installations as well as any accidental damage to the existing structures.

Renovating a home is not an easy task. But, we all know that Rome was not built in a day. If you want to transform your idea into a reality successfully, watch over the entire process of the home renovation project.