How to use your home equity to feather your nest!

More than a decade ago, trendsetters began to tell us about the future trend of “cocooning”.  They predicted that decoration magazines, home renovation businesses and luxury home fashions and furnishings would see a big boom. However recently we continued to look outside our home for entertainment, and the idea of nesting at  home seemed unlikely. 

But the the futurists were right, and Canadians have come home en masse: to work ( as I am doing right now) to play, to socialize, and the retreat. Not surprisingly, they are reshaping their homes to accommodate their new passion for home life. Canada has become the renovation nation, with more than one third of Canadian homeowners planning a significant renovation in their near future ( just ask my wife) and  according to CMHC. Even with our simmering economy sales for home improvements remain strong, just try to find a parking spot at your local Kent, Home Depot or Rona on a Saturday Morning. That “Honey Do List” needs to be tackled.

So where are people spending the money? People are still renovating their kitchens, but they have been overtaken by exterior renovations ( like landscaping, roofing, decks and fences) bathroom renovations ( anyone need a bidet?) and carpeting and flooring. Kitchens are now the 4th most popular. Do it your self renovations are most likely to tackle rec-room renovations or paining and wallpaper. 

Before you embark on a renovation project, you should consider whether you are improving your home for your own comfort, or to increase the value of your home. Renovations are not created equal, and some will perform better than others when it comes to adding value to your home.

Most renovations will improve the value of your home, but you should not expect to fully recover your renovation costs. There are some exceptions and they often vary from one region to another. Go to the CMHC website as they provide a general cost vs value guideline. For example, you can expect to recoup up to 73% of a kitchen renovation, making it the smartest renovation investment. Followed by bathroom  up to 71% then exterior work like landscaping or painting up to 62% and re doing the family room up to 56% of your investment. 

But there is more to the renovation fever than a desire to practice trading spaces at home. The passion for home life is coinciding with the availability of attractive financing. A mortgage is one of the lowest cost of borrowing loans that you can get, and Canadians are taking advantage of this to do the upgrades that they have been dreaming of, rather than putting it on the credit card!

If you are thinking of doing a major renovation, then you owe it to your self to give us a call to find out about some of the financing options that are available. I look forward to hearing from you.

 

Cheers,

Pat

 

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