Welcoming a new member of your family into this world is one of the greatest joys and achievements we can experience in our lifetime.
A new addition to your family brings with them new responsibilities; one of your first will be considering how to modify your existing home to support your new family dynamic.
The cost of adding a room to support your growing family can vary, and this brief guide will give you an overview of the most important cost factors to keep in mind when renovating.
Before you start
Measure twice, cut once, as the adage goes, and the first step toward renovating your home is no different. This stage is all about scoping your project and fully understanding the total costs of renovating:
- Are you adding a new room or renovating an existing room?
- If you are renovating, how many rooms will you need to change?
- What is the size of each room you are renovating?
- What materials will you be using?
- Will you be doing any work yourself or hiring a crew to complete the project?
Those are some of the most common considerations but, as a new parent, you’ll also need to think about.
- How invasive the renovations or construction will be
- How to childproof the rest of your home if you haven’t already done so.
- How the requirements of your family may change over time (e.g. multiple children who will share a room but then require their own personal space as they grow older).
Once you’ve decided on a rough overview of your project and what you’ll need, your next step is to dig a little deeper (so to speak!) and get an accurate overview of the costs.
An overview of costs
As we touched on above, the costs of renovations can vary wildly, and it’s important here to be realistic about what you can afford:
- Get multiple quotes on the project if you are using a construction crew
- Ask about the materials used and their safety and quality
- Ask about the timeline of the project (you’ll definitely want it completed in time!)
Take as much time as you can afford to research and get a total overview of the costs at this stage, as this may influence the scope of your project and your priorities.
For example, the cost of renovating your home to include a new bedroom may cost anywhere from $2,000 to $35,000 or more, depending on the labour requirements, structural changes to the home, and materials used.
Once you’ve settled on both what you need and what you can afford, it’s time to either begin your project (if you have the available savings) or decide on how you will finance your renovations.
Financing renovations: Equity vs Personal loan vs Construction loan
As most parents will attest to, finding a spare $150,000 just laying around the house is a fantasy most of us can’t indulge ourselves to think about.
Most of us will require at least some form of financial assistance to renovate. Thankfully, there are several options available:
- Equity finance: Borrow the portion of the home loan already repaid and refinance your mortgage to fund the renovations.
- Construction loan: A specific finance product used for major renovations (generally construction) which may cost $150,000 or more.
Final words
Equity finance may get you the best rates, while home renovation personal loans have a shorter approval time and more flexible terms than a mortgage or larger loan.
Construction loans require a contract with a builder and payments will be released and made in stages as the project is completed.
Whichever option you choose, it’s important to take your time to compare your options, get personalised quotes from each lender you speak to, and find the type of finance that will suit you and your family best, well into the future.
