How To Decide Between Renovating and Buying a New Home

Your home environment is a huge factor for your mental health. Do you have enough space? Is it easy to clean or a badly designed mess? Do the fixtures in your kitchen or bathroom not work quite right and you just put up with it? And do you have an area in your home that truly feels like you? 

If you decide you need to make changes to your home, you might be tempted to start fresh with a new place but there’s also the option to renovate your current property. A new coat of paint, fresh tiles or changing a bedroom into a study can drastically alter the view you have of your home and, ultimately, yourself.

What costs do I need to consider for renovating versus moving?

Action	Renovating the Old	Buying the New
Budget	While the average renovation cost for Aussie homes was  $63,118 in 2020,1Suncorp – The true cost of the average home renovation revealed it really does depend on location.  From as little as $2000 to as high as $500,000+2Suncorp – How much does the average home renovation cost in Australia? – it’s a case of how-long-is-a-piece-of-string when it comes to renos!	For a local move, you’re looking at anywhere from $300 to $3,500 but if you’re crossing state lines, interstate moves can cost as much as $8,000.3Airtasker – How much does it cost to move house? Then you need to consider the property price, but that is a whole other article.
Loans	Using that equity to jazz up your place depends on how much the money folks are willing to lend you. Just because you’ve got a cool $100,000 in equity doesn’t automatically mean the bank will hand you that exact amount. They’ll look at your ability to handle the extra debt, and you have to prove you can pay back what you borrow, which is a whole other ballgame.	When buying new, you start the process of applying for a home loan again, albeit with a possible boost from the sale of your previous place. iSelect have partnered with Lendi* to make this easier.
Government assistance	The HomeBuilder grant may apply to those looking to give their old place a sustainable makeover.	The Home Guarantee Scheme (HGS) is another similar offering from the Australian Government to support eligible home buyers when purchasing property.

How do housing market trends come into play? 

It’s always a good idea to consider the Aussie property scene when deciding whether to renovate or move. In certain neighbourhoods, property values are shooting through the roof, and savvy homeowners are cashing in big time. 

A 2023 study with a panel of property experts of the Australian suburbs with the best growth potential found that the top five spots were all in the ACT!⁴Morningstar – 100 suburbs with the best growth potential in 2023 Curtin, Narrabundah, Red Hill, Scullin, and Watson topped the list, with NSW suburbs Alexandria and Arncliffe following closely behind. 

Where can I find and compare home loans? 

If you’re sitting on that fence, it’s time to get off and make things happen! Grab a pen and make a checklist of everything you want and need in your dream home. If you’ve tinkered with your current place, but it’s still not measuring up, it could be upgrade time! 

The crew at iSelect have teamed up with Lendi*, so you don’t have to navigate this alone. We’ve got this awesome online tool that lets you compare home loans galore.