According to a CIBC survey released in May, more Canadians are planning on renovating their homes this year. These are surprising results given the growing amount of household debt. The survey revealed that 48 percent of Canadian homeowners are planning on renovating their homes this year, which is a 37 percent increase from the year before.
Home renovations is a bigger market in Canada than housing construction. Therefore, it is safe to say, that Canadians love to spend money on renovations, spending the majority of their money on improvements around the house.
It’s no surprise that Ontario and British Columbia, the provinces with the hottest housing markets in the country, will spend the most on renovations. However, Statistics Canada found Alberta spent a record high of 1.8 million in the first quarter of 2017. Why is Alberta breaking records? ATB Financial chief economist Todd Hirsch stated this may be due to all the repairs of damaged homes from the Fort McMurray wildfires. A likely factor to the record high spending could be because of recent layoffs in the province giving Albertan’s more time on their hands and extra money to spend on improvements from their severance packages. Also, Contractors are more affordable this year compared to 3- 4 years ago and homeowners may be taking advantage of the lower prices Hirsch stated.
Whether your plan is to purchase a new home and renovate or stay in your home and renovate, it is important to develop a plan and a budget before you start tearing down and fixing things around your home. Also, a good question to keep in mind is, what Improvements, maintenance, or repairs will help you maintain or increase the equity of your home? It’s easy to get carried away with all the exciting and inspiring home renovation ideas we see either online or on your favourite renovation show, but it is very important to keep in mind your long-term goals, like increasing the value of your investment over time.
So, if you are renovating your home, or planning on renovating in the near future, what should be first on your checklist? Maintenance and updates of all the systems of your home! Consider updating things around the home that are energy efficient and will help you save you money in the long run such as your: HVAC, Appliances,Roof, Windows, Doors, Electrical and Plumbing.
These updates, even though they cost a lot more money than just painting the walls, will save you money in the long run and will appeal to future homebuyers.
Remember that the cost of many of these improvements does not necessarily have to be out of pocket. There are many financial options available such as Purchase Plus Improvements, lines of credit, or refinancing programs. If you have questions about any of these financing options, don’t hesitate to contact me for more information.
Let the Renovation’s Begin
Now the fun part…
Once, the maintenance and energy efficient updates are complete, and if your budget is not depleted, think about the kitchen or bathrooms. The most important rooms to consider when renovating your home is the kitchen and bathroom because, on average, they offer the highest return on investment.
Depending on how long you are staying in your home after renovations, you might want to consider renovations that are more practical and functional, like more storage/countertop space, before deciding on cosmetic design. For example, homebuyers love an open concept and having space in the kitchen so you might want to consider knocking down a wall and building an island, which will offer more countertop space as well. In the bathroom, homebuyers’ number one request is to have a washroom resemble a spa like atmosphere. Also, think about upgrading your kitchen and washroom fixtures. Something as small as new faucets in the kitchen or bath can make a big difference.