It’s not unusual for people to buy their first home with the intention of renovating it. After all, buying a house in great condition, in the right location, with all the characteristics that you’re looking for, is likely to be extremely expensive. In many parts of the world, housing prices are frighteningly high, and first-time buyers are usually on a very limited budget.The best option is to find a house that’s dilapidated and therefore cheap, but one that is in a good neighborhood and has the potential to be great once it’s been renovated. The cost of such a house plus the cost of renovation is likely to be considerably less than if you were to buy a similar, finished house outright.
Of course, this is easier said than done. Buying your first home can be a difficult and intimidating process, but there’s no doubt that it’s also very exciting, and if done right, extremely satisfying too. When you bring renovation into the picture, all of this gets magnified, and so does the risk of something going wrong. Here are a few tips to help you go about renovating your first home.
Consider whether your first home will be your permanent home.
Many people recommend buying your first home more as an investment than as a home. The younger you are when you buy your first home, the more this advice applies to you. People change as they grow older, and they also get more set in their ways. Twenty years from now, you might not want to be living in the house you choose to buy today; but right now, you’re probably more willing to make compromises. So think ahead – consider whether you’re going to be living in this house for the rest of your life, or whether this is only a stopgap arrangement till you have what it takes to buy a permanent home.
How you do your renovation should depend on whether the house will be with you forever or be eventually sold to someone else. If it’s your permanent home, then you can pretty much do whatever you want, within the limits of practicality and budget of course. However, if you plan to resell, you should be considering what has the broadest appeal and the best return on investment. Many people make quirky, whimsical renovations that they find charming but that potential buyers will dislike and need to spend money changing.
Thoroughly research and plan every aspect every step of the way.
Buying a first home and renovating is a long-cherished dream for many people, but making a dream come true requires thorough planning. Start your research well in advance, and look into every possible aspect from the start to the finish, from the big picture to the little details. By the time you get around to actually buying your house and starting work on it, you should be a bit of an expert in the field. Find out about house prices and renovation costs, resale values, contractors, local laws, local taxes and permissions, and how much time renovation takes depending on how much work a house needs.
Learn how to read floor plans. Learn about everything from paint to lighting to wiring. And get into the details – with paint, for example, learn about the different types, the various brands, what they cost, what they’re used for, how they look, and how long they last. It’s often tiresome work, but it’ll save you a lot of trouble and expense later.
Work out a budget.
This is of course obvious, but there’s a lot more to working out your budget than simply figuring out what you can afford to spend on a house. This initial bit is of course essential, but next, when you’re looking for houses, consider not only the price of the house but what percentage of the price you will need to spend on renovations. It is also a good idea to get a professional assessment of your costs.
One recommendation is that the cost of renovation shouldn’t exceed 5-10% of the cost of the house itself. However, this will probably vary from situation to situation, depending on the house, the country, the location, and on you yourself. This also matters more for an investment – if you plan to resell at a profit, it is particularly important to keep your renovation costs down.
However, even if you never plan to sell, it probably makes no sense for your renovation costs to be equal to the cost of the house itself, considering the stress and disruption to your life. It’s also important to always add a buffer of at least 10% to account for unplanned expenses, inflation, and various problems that invariably pop up along the way.
If possible, save instead of borrowing.
Borrowing money to renovate your house can be expensive, and also comes with its own stresses and complications. If possible, the ideal situation is to save money and renovate your house bit by bit. This not only keeps your costs down, but it’s also more satisfying in some ways.
Of course, whether this is practical or not depends on the condition of the house, among other things. With the down payment and the other costs involved in buying a house, most people aren’t left with much money to spend on renovations right away. If there are elements that urgently need to be attended to, you could use credit or a loan to immediately begin work on them, and leave everything else to be done in installments over the next few years, while you save money accordingly.
Focus on the exterior and the essentials.
Don’t make the mistake of going in and changing absolutely everything. If you’ve planned and budgeted properly, this is unlikely to happen, but it’s still worth mentioning. There will be plenty in your new home that needs minimal or cosmetic work. Focus only on the essentials and on the exterior. It’s important for your house to both protect you from the weather and look good from the outside, especially if you plan to resell. A smart exterior has a great impact on the resale value, and sometimes all it takes is a new coat of paint. Inside the house, first focus on things that actually need to be repaired, and not on redecoration. This isn’t to say that you should forget your dreams and make do with the bare minimum. However, you can do without your dream bathroom or get around to it later, but you’re going to have serious trouble with plumbing or wiring that’s a mess.
Do what you can yourself.
One of the best ways to save money when renovating your home is to get your hands dirty. Besides, once again, there’s a special satisfaction in knowing that you’ve put your own time and sweat into the house you’re living in. However, do make sure that you know what you’re doing. You don’t want to end up hiring a professional to both undo your damage and do the original job. Most people have only basic skills, but even those can be put to use. If nothing else, take on the responsibility of painting your new home. If you can, get help from a friend, especially for tasks you’re not too confident about. And whatever you do, ensure that you have all the necessary equipment, including work gloves and boots, protection for your eyes and ears, and the right tools for the right job. If you must, cut corners on everything else, but not on safety. You’re not really going to save any money or get any satisfaction if you hurt yourself or damage the house.
Hire a good contractor.
For everything you can’t do yourself, you will of course need to hire someone else. Be sure to hire a contractor who is experienced and trustworthy. The best way to do find such a person is usually through word of mouth. Ask friends and family for recommendations – and again, if you’ve started your research in advance like we suggested earlier, you should have plenty of time to find a good contractor in this way.
If this turns up no leads, you fortunately still have the option finding one online. Don’t go by the contractor’s own website, but by online reviews and referrals. If possible, actually speak to people who have hired the contractor in the past, and ask if you can view the work in person.
Finally, remember that supervision is extremely important, even if you have the best contractor in the world. Supervision can take up a huge amount of your time and energy, and most contractors will say you don’t need to check in more than once a week, but daily supervision is crucial if you want things done right and within budget.
Don’t scrimp on quality (but don’t blow your money on the most expensive options either).
One common mistake people make when they’re on a budget is to go for the cheapest option available. This rarely works. The cheapest option is usually the one with the poorest quality, and will either break before you know it or not work like it should. In the long run, you won’t be saving any money at all. On the other hand, don’t waste your money on the most expensive option either. Even in terms of the resale value of your house, the cheapest options won’t help you, and the most expensive options won’t push the price up enough to be worth the expense. Choose mid-range products from a reputable company, and you will usually be perfectly fine. If you can’t afford mid-range options right now, it is probably worthwhile to wait and save up some money.
Go green, but don’t go trendy.
Trendy, by its very nature, is fleeting. What’s trendy today won’t be trendy tomorrow. A few years from now you may not like it yourself, and worse still, if you want to resell your house, outdated trends will only be an impediment. Buyers won’t pay for things they need to get rid of, so the money you’ve put into your house will not have pushed its value up by much. Especially if your house is meant as an investment, stick to classic, evergreen options that will appeal to a wide range of people.
However, it’s always worth going for the green option. Experts say the demand for green materials and products is only going to grow, and besides, having an energy-efficient and environmentally friendly house benefits everyone, including you. The green option is sometimes more expensive than the regular one, but you’ll make up the price difference in no time through energy savings. With electrical appliances, for example, the price difference between the least and most energy-efficient products can be huge, but you’ll usually save that amount many times over within a few years.
Avoid second guesses and regrets.
As with many of the other tips we’ve provided, proper research, planning, and budgeting should leave little room for mistakes here. Nonetheless, it’s worth reminding yourself that there’s no point looking back at what you could have done better. Things can and will go wrong when renovating a house, and it’s not unusual for budgets to be stretched. If you’ve done your homework thoroughly, you’ve done the best you could, and there’s no way you could have prepared for unforeseen complications. Focus on the good parts of your new home, and forget about the bad. And even if there are problems that can’t quite be ignored, regret is useless. Focus on looking ahead – save up a little money, and fix the problems some time in the future.
Have you renovated a house? Do you have any tips for others who are thinking of doing the same? Let us know in the comments!