The last 18 month have made for very uncertain times, as we had started to witness huge changes in the real estate industry. Buyer wants and needs have shifted tremendously with many individuals spending more time residing in their home. Whether that means needing a home office or a workout area, buyers have started desiring new spaces in their homes. The American Institute of Architects released their AIA Home Design Trends Survey results for Q3 2021. The survey reveals the following:
- 70% of respondents want more outdoor living space
- 69% of respondents want a home office (48% wanted multiple offices)
- 46% of respondents want a multi-function room/flexible space
- 42% of respondents want an au pair/in-law suite
- 39% of respondents want an exercise room/yoga space
If you are a homeowner looking to add any of these spaces to your home you have two options: renovate your current house or buy a home with these features already available. The decision you make will be influenced by the following factors:
- Desire to relocate
- The difference between the cost of renovation and a new purchase
- Finding an existing home or designing a new home that has exactly what you want
In either case, you will need access to capital: the funds for the renovation or the down payment your next home would require. The great news is that the money you need probably already exists in your current home in the form of equity. The record-setting increases in home prices over the last two years dramatically improved homeowners’ equity.
As a homeowner, the money you need to purchase the perfect home or renovate your current house may be right at your fingertips. However, waiting to make your decision may increase the cost of tapping that equity.
If you decide to renovate, you’ll need to refinance (or take out an equity loan) to access the equity. If you decide to move instead and use your equity as a down payment, you’ll still need to mortgage the remaining difference between the down payment and the cost of your next home. If the past 18 months have refocused your thoughts on what you want from your house, now may be the time to either renovate or make a move to the perfect home.