Engineering and construction projects are rarely simple. Even when it comes to the relatively quotidian kind like home remodelling and renovations. Every home is unique and represents its own individual combination of challenges and complications. But when trying to plan a remodel, it’s often tempting to think in absolutes. To start thinking in terms of percentages. Of how much more profitable X remodel will make your property. And while there’s no harm in following a “rule of thumb” guideline, it’s important to remember that absolutes are virtually nonexistent in the realm of construction.
In the current climate, with the market reeling from the effects of COVID-19, many are unsure whether or not now is the right time to invest in property. And while we should certainly be cognizant of the way the market is changing in 2020, it’s important to remember that deals are still closing, people still need places to live, and there’s certainly scope to turn a profit with the right property. Whether you’re thinking of flipping a property, making some changes to your existing investment property to boost rental income and improve margin, or simply make some changes to your home to make it more profitable later down the line, it’s important to go into the project with realistic expectations.
However, when we give into common myths and misconceptions (the kind that real estate shows tend to perpetuate) it can lead to disappointment, excess waste and expenditure that can push a project way over budget. In this post, we’ll look at some of the myths and misconceptions that you’ll need to disregard to ensure that your project goes as smoothly and cost-effectively as possible…
Any remodel is money well spent
In fairness, there are a number of ways to interpret this. If you are making renovations to your home that improve the quality of the time you spend there, then this is actually pretty sound advice. Especially in the current climate when we rely on our homes to make us feel safe and protected from a world that’s much riskier and more forbidding than it was even at the start of the year. However, if you’re thinking solely in terms of turning a profit, then it’s certainly a myth.
Not all renovations are created equal, and some are more consistently profitable than others. Take a look at this post where we examined the profits that you can expect from various renovations around the home. Again, however, we hasten to add that these are only estimates. Your actual profits will be subject to the whims of the markets, whether or not you’re using the Best Realtors, the location of your property, and other factors. Some of which are within your control. Others… not so much.
Doing it yourself will always save you money
Unfortunately, another misconception is that a skilled DIYer will be able to carry out a renovation more cost-effectively than a contractor. But this is almost always a misconception. Even those who have a lot of experience in DIY won’t accrue the muscle memory or wealth of experience. Many of us have grown up with horror stories about builders from hell or unlicensed conmen (thanks again reality TV). But the truth is that construction is (and always has been) a low margin business that relies heavily on referrals. In other words, ripping customers off is not a sustainable business model. And in the digital age, contractors know the damage that a negative review can do for their brand. Most contractors invest heavily in earning the trust of prospective customers. They’ll be licensed and insured, their pricing structure will be made transparent, and they’ll endeavor to get the job done within a reasonable timeframe at a reasonable price. What’s more, they will likely be well connected, and be able to get raw materials at a better rate than you could on your own.
Because delays can add to the costs of a project (especially if you’re paying for accommodation to stay in until work is complete in your home). They can also invite complications that bring their own expenses. Given that we have a tendency to err on the side of optimism, even an experienced DIYer will usually take longer to get the job done and invite costs that eclipse the savings made by going it alone.
Spending on lavish design is more likely to attract buyers
When making renovations, structural integrity, and sturdy workmanship trump aesthetic bells and whistles any time. But let’s be honest. We all want to experience the wow factor that comes with seeing the end result. However, those who focus heavily on aesthetics can find themselves making decisions that greatly exacerbate the overall spend in ways that may not necessarily generate a great return on your investment.
Design flourishes and expensive materials may not necessarily attract more buyers. In fact, if the design is too idiosyncratic it may prevent buyers or tenants from feeling that they can put their own stamp on the property and make it their own.
Again, if you’re making renovations for your own home, by all means, invest in whatever design or materials will bring you joy. Just remember that they may not necessarily contribute to the project’s profitability.
Your home will be unlivable while the project is underway
Finally, as well as the cost of the remodel itself, there are also ancillary costs to consider. Like the cost of accommodation for yourself and your family while contractors carry out work in your living space. But before you book a hotel or a short term rental property in which to stay while renovations are underway, you should talk to your contractor about how much the work will actually impact your living arrangements. Many people assume that their home will be unlivable from the moment the team arrives on-site to the moment work is complete. But this is almost never the case. You will usually be able to love perfectly comfortable in your home for the majority of the remodel.
