New houses in urban Toronto are few and far between, so if you want to buy a home in the city, it will be old, and likely in need of repair and remodeling. Maybe it is not evident right away, or maybe it is and you can live with it temporarily, but it’ll come. Then what? A small repair here, a little renovation there mean living in a house that’s never finished? Or, one huge, disrupting project to completely modernize the home all at once? We chose option two. There was a lot of work to be done, and we wanted to complete it as quickly and efficiently as possible.
As we did our research, we learned a few things about renovating an old house that caused us to reassess and choose to rebuild instead. The main reasons were: (1) the risks associated with renovating an old house; (2) the contingency budget required for a major renovation compared with a rebuild; and (3) the limitations of renovation.
Renovating an old home is risky
Renovations and their estimated costs are based on the assumption that areas of the home are in a certain state of repair, especially areas that are not being renovated. Unfortunately, with older homes, this assumption is all too often proven wrong. We have all heard stories or seen television programs where unfortunate renovators discover that the structure is deficient or something has been damaged during a previous renovation. If we had decided to renovate, we would have encountered this. After deciding to rebuild, we attempted to maintain one wall of the old foundation to act as an additional support between the neighbor and our home. When we tore down the house (watch the video), we discovered this wall had been penetrated by tree roots, and it fell apart. Had we decided to renovate, and were dependent on maintaining this wall, the scope of the project would have ballooned, the costs would have skyrocketed, and we would have been very stressed out. Besides money, there would have been substantial delays, and the move-in date would have been pushed back weeks, if not months. What if there is a hard move-in deadline and the extra time is not available?
A large contingency budget
A contingency budget is a separate pot of cash that smart homeowners set aside for unforeseeable expenses that arise during the renovation or rebuild. It should be included in every project budget, but the size of the contingency budget for large-scale projects can be considerably different for renovations and rebuilds. When discussing our project, we were advised the contingency budget for the complete renovation of our old house would be close to 35% of the total budget, but would only be 5% of the total budget for the rebuild. Why? Because old homes often have hidden problems that must be addressed to successfully complete the renovation. In contrast, when you start fresh, you do not have to make risky assumptions about the pre-existing structure, so potential concerns are limited and often relate to the land where the house is being rebuilt.
For our project, we decided that predictable costing, even if the base budget was larger, was the better option for us. We did not want to gamble on the possibility of having to spend up to 35% more of our renovation budget on unexpected discoveries and extra requirements, stress mounting every time they occurred.
Renovations don’t always give you what you want
While one of the benefits of renovating is reusing existing building structures – to save money, materials, or maintain the original look – this is also one of its limitations. Sometimes you just can’t achieve exactly what you want in a home when using the existing house. For example, an old basement usually won’t convert well to recreating a space where you would be inclined to entertain. Our old basement had low ceilings, no radiant in-floor heating, a furnace in the centre of the living space, little in the way of natural light, and moisture issues. You can’t hammer a square peg into a round hole. We would never have achieved the inviting and useful space we have today on our lower level if we had renovated and used the existing foundation.
If you are vacillating between renovating and rebuilding, feel free to contact us for further information about the rebuild process and what this might look like for you.