Home renovation shows have a remarkable ability to inspire, sparking creative ideas for transforming our living spaces. However, amidst the allure of these shows lies a notable caveat – they can be quite deceptive when it comes to the actual process of renovating.
While these shows often tempt us to replicate the dazzling transformations we witness, venturing into a renovation project without a full understanding of the intricacies involved might lead you to tackle a project you’re not quite prepared for. To help you distinguish between reality and the magic of television, we’ve deconstructed the various components that accompany the renovation journey.
Budget & Financing
In the realm of most home renovation shows, financial considerations are often glossed over or completely omitted. In the real world, embarking on a home renovation requires engaging with professionals like mortgage brokers or experts at Dominion Lending Centres to evaluate your financial options.
Financing a renovation can be achieved through several avenues:
1. Mortgage Refinancing: This avenue allows you to borrow up to 80% of your home’s appraised value (after subtracting your existing mortgage balance). It offers immediate access to funds and generally boasts lower interest rates compared to credit cards or personal loans. This option is ideal for substantial renovations or remodels. Aim to refinance at the end of your mortgage term to avoid penalties.
2. Purchase Plus Improvements Mortgage: Perfect if you’re yet to purchase a home, this option lets you include renovation costs in your initial mortgage. It’s tailored for modest upgrades rather than extensive structural changes. These improvements encompass painting, flooring, windows, heating systems, kitchen and bathroom updates, and more. Depending on your mortgage terms, this option can grant you between 10% and 20% of the initial property value for renovations.
3. Financing Improvements Upon Purchase: Similar to the Purchase Plus Improvements approach, this option permits you to finance renovations alongside a new home purchase, utilizing CMHC Mortgage Loan Insurance. It’s feasible to obtain financing with just a 5% down payment for both the property acquisition and subsequent renovations, up to 95% of the post-renovation value.
4. Line of Credit or Home Equity Loans: Alternatively, secured lines of credit or home equity loans can fund your renovation. These loans, backed by your home equity, usually offer up to 80% of the property’s value and are accessible at any time. They generally entail lower interest rates compared to unsecured financing, offering flexibility in accessing funds.
Once you’ve determined your renovation financing, the next step is crafting a budget. Television rarely conveys the accuracy of listed renovation budgets, often concealing additional expenses. In some instances, networks or shows even supplement budgets behind the scenes, unbeknownst to viewers. Thankfully, in reality, you can establish a pragmatic renovation budget through diligent research and obtaining quotes. Collaborating with a seasoned contractor becomes pivotal, ensuring compliance with building codes and preempting any unforeseen costs. Moreover, a professional can guide you in formulating a comprehensive budget and project timeline, guarding against mid-project financial hiccups due to alterations or selecting pricier materials.
Renovation Timeline
Arguably, one of the most far-fetched elements of home renovation shows is the timeline. While television may suggest a swift overhaul of your kitchen in a matter of weeks, the reality often extends beyond those optimistic projections.
Partnering with your contractor to establish a feasible timeline rooted in your project’s scope is crucial, reducing stress and providing a more accurate overview. It’s essential to bear in mind that your readiness for renovation doesn’t necessarily align with a contractor’s availability. Additionally, potential setbacks like material shortages can arise, demanding flexibility when plotting your timeline.
Planning & Design
Television renovations often portray interior designers making unilateral decisions, deviating from actuality. Real-life renovations entail meticulous documentation and pre-planning in collaboration with clients. Furthermore, unlike shows sidestepping certain aspects, real-world renovations necessitate securing building permits and undergoing inspections throughout the process. Though this might be time-intensive, it’s integral to guarantee the legality of your renovation, ensuring insurance coverage in the event of any mishaps.
Embarking on a home renovation diverges significantly from its television depiction. Nonetheless, armed with meticulous planning and the support of adept financing and contracting professionals, your vision can materialize. Take the first step by reaching out to your mortgage expert today.